SEC Charges Former Digital World CEO With Securities Fraud

US SEC sues Digital World’s former CEO alleging securities fraud

The U.S. Securities and Exchange Commission on Wednesday sued Patrick Orlando, ex-chief of Digital World Acquisition Corp that helped former U.S. President Donald Trump’s social media company go public, for securities fraud.

In a filing with the court of District of Columbia, the SEC said Orlando broke rules concerning securities by issuing false and misleading statements while he led the blank-check firm.

Orlando misled investors by failing to disclose that his company had formulated a plan to acquire Trump Media & Technology Group Corp and was pursuing the acquisition before DWAC’s initial public offering, according to the filing.

SEC Awards More Than $37 Million to a Whistleblower

The Securities and Exchange Commission today announced an award of more than $37 million to a whistleblower who provided information not previously known to the SEC and which significantly contributed to a successful enforcement action. The whistleblower also met with Enforcement staff and identified potential witnesses and documents, which conserved staff time and resources.

Ex-Goldman Sachs Associate Gets 28 Months in Insider Trading Case

A former Goldman Sachs Group Inc. associate will spend 28 months behind bars after admitting to passing inside tips to friends while working at the investment bank and Blackstone Inc.

Anthony Viggiano, 27, was sentenced on Wednesday by US District Judge Valerie Caproni in Manhattan. He pleaded guilty to a single count of securities fraud in January for tipping off two friends to at least seven transactions that he learned about while working at the two Wall Street firms.

SCOTUS to Clarify Securities Fraud Pleading Requirements for Falsity and Scienter

Since the PSLRA’s passage, lower courts have wrestled with applying the heightened pleading requirements for claims arising under Section 10(b) and Rule 10b-5 of the Exchange Act. As a result, circuit splits have emerged on both the element of falsity, i.e., whether the facts alleged misrepresentations or omissions with particularity, and the element of scienter, i.e., whether the facts alleged give rise to a strong inference that the defendant acted knowingly or with severe recklessness. The Supreme Court’s forthcoming decision will likely resolve these circuit splits and bring much-needed clarity to the adjudication of securities fraud class actions.

The Supreme Court also has the rare opportunity to ensure that the PSLRA’s pleading requirements remain robust in courts across the country. Indeed, motions to dismiss in securities class actions often challenge the adequacy of allegations on the elements of scienter and falsity. And plaintiffs regularly seek to prove scienter by alleging that internal company documents contradict company executives’ public statements. Further, the 9th Circuit’s ruling, if not overruled, would sanction the practice of retaining expert witnesses to support otherwise unsupported allegations of falsity in securities fraud class actions….

Microsoft fires DEI team — becoming latest company to ditch ‘woke’ policy: report

Microsoft has reportedly laid off a team devoted to diversity, equity and inclusion after pouring millions of dollars into the initiative — becoming the latest major company to ditch the “woke” policy.

The Big Tech giant disbanded the DEI team at the beginning of the month due to “changing business needs,” according to a July 1 email obtained by Business Insider.

It is unclear how many employees were affected.

The decision was a further sign that companies are pulling back on diversity-based initiatives that were put in place following the 2020 death of George Floyd and the subsequent Black Lives Matter protest campaigns.

Ex-Platinum Partners chief avoids prison in fraud case

The founder of the now-defunct Platinum Partners hedge fund was sentenced on Tuesday to six months of home confinement over his role in what prosecutors called a scheme to defraud bondholders of an oil and gas company.

Mark Nordlicht was sentenced by U.S. District Judge Brian Cogan in Brooklyn, five years and one week after he was convicted, and following several post-verdict legal challenges.

Chevron Upset Warns SEC to Heed Congress, Agency’s Peirce Says

SEC rule-writers should understand what lawmakers want and avoid “creative” lawyers after the Supreme Court’s recent rollback of the Chevron doctrine governing court fights over agency regulations, SEC Commissioner Hester Peirce said Wednesday.

The Securities and Exchange Commission needs to identify the statutory authority it’s using when making a rule, said Peirce, one of two Republicans on the Democratic-led SEC. The Supreme Court cautioned regulators to be careful in its Loper Bright Enterprises v. Raimondo decision, she said. The June ruling toppled a legal precedent under which courts deferred to reasonable agency interpretations of vague laws.