SEC Charges Intercontinental Exchange With Failing to Inform Agency of Cyber Intrusion

SEC Charges Intercontinental Exchange and Nine Affiliates Including the New York Stock Exchange with Failing to Inform the Commission of a Cyber Intrusion

The Securities and Exchange Commission today announced that The Intercontinental Exchange, Inc. (ICE) agreed to pay a $10 million penalty to settle charges that it caused the failure of nine wholly-owned subsidiaries, including the New York Stock Exchange, to timely inform the SEC of a cyber intrusion as required by Regulation Systems Compliance and Integrity (Regulation SCI).

According to the SEC’s order, in April 2021, a third party informed ICE that ICE was potentially impacted by a system intrusion involving a previously unknown vulnerability in ICE’s virtual private network (VPN). ICE investigated and was immediately able to determine that a threat actor had inserted malicious code into a VPN device used to remotely access ICE’s corporate network. However, the SEC’s order finds that ICE personnel did not notify the legal and compliance officials at ICE’s subsidiaries of the intrusion for several days in violation of ICE’s own internal cyber incident reporting procedures. As a result of ICE’s failures, those subsidiaries did not properly assess the intrusion to fulfill their independent regulatory disclosure obligations under Regulation SCI, which required them to immediately contact SEC staff about the intrusion and provide an update within 24 hours unless they immediately concluded or reasonably estimated that the intrusion had or would have no or a de minimis impact on their operations or on market participants.

Ex-Nuveen Trader Sentenced to 70 Months in Insider-Trading Plot

A former Nuveen equity trader was ordered to spend almost six years behind bars after admitting he tipped off another man to the firm’s trades as part of a $47 million front-running scheme.

US District Judge Paul Gardephe sentenced Lawrence Billimek on Monday to 70 months in federal prison, matching the minimum punishment requested by prosecutors. Billimek, 53, pleaded guilty to one count of securities fraud as part of an agreement with prosecutors.

Craig Wright Is Not Bitcoin Creator Satoshi Nakamoto, Court Rules

A few minutes later, the judge overseeing the proceedings, James Mellor, issued a ruling from the bench. “Dr. Wright is not the person who adopted or operated under the pseudonym Satoshi Nakamoto,” he said.

Crypto fans celebrated online, proclaiming the end of a “reign of terror.” Mr. Dorsey, the Twitter founder, posted the full text of Justice Mellor’s ruling. In a closing submission, COPA’s lawyers called for the court papers to be forwarded to British prosecutors, who could investigate whether Dr. Wright had committed perjury.

Once the most talkative man in the industry, Dr. Wright went silent….

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The week after the ruling, corporate filings in England showed that Dr. Wright was transferring assets worth as much as 20 million pounds to an offshore entity. COPA argued that he might be shielding them from seizure by the court, and Justice Mellor ordered his assets frozen. COPA has “a very powerful claim to be awarded a very substantial sum,” the judge said.

Statement on the Financial Innovation and Technology for the 21st Century Act

The Financial Innovation and Technology for the 21st Century Act (“FIT 21”) would create new regulatory gaps and undermine decades of precedent regarding the oversight of investment contracts, putting investors and capital markets at immeasurable risk.

First, the bill would remove investment contracts that are recorded on a blockchain from the statutory definition of securities and the time-tested protections of much of the federal securities laws.

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Second, the bill allows issuers of crypto investment contracts to self-certify that their products are a “decentralized” system and then be deemed a special class of “digital commodities” and thus not subject to SEC oversight. Whether something is a “digital commodity” would be subject to self-certification by “any person” that files a certification.

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Third, the bill’s regulatory structure abandons the Supreme Court’s long-standing Howey test that considers the economic realities of an investment to determine whether it is subject to the securities laws. Instead, the bill makes that determination based on labels and the accounting ledger used to record transactions. It is akin to determining the level of investor protection based on whether a transaction is recorded in a notebook or a software database….

Ivan F. Boesky, Rogue Trader in 1980s Wall Street Scandal, Dies at 87

Ivan F. Boesky, the brash financier who came to symbolize Wall Street greed as a central figure of the 1980s insider trading scandals, and who went to prison for his misdeeds, died on Monday at his home in the La Jolla neighborhood of San Diego. He was 87.

His daughter Marianne Boesky said he died in his sleep.

An inspiration for the character Gordon Gekko in Oliver Stone’s movie “Wall Street” and its sequel, Mr. Boesky made a fortune betting on stock tips, often passed to him illegally in exchange for suitcases of cash. His guilty plea to insider trading in November 1986 and his $100 million penalty, a record at the time, sent shock waves through Wall Street and set off a cascade of events that marked the end of a decade of frenzied takeover activity and the celebration of conspicuous wealth.