SEC Sends Wells Notice to Uniswap as Unregistered Broker and Exchange

DeFi Exchange Uniswap Receives Enforcement Notice from the U.S. SEC

Decentralized crypto exchange Uniswap received a notice from the U.S. Securities and Exchange Commission (SEC) that it intends to pursue an enforcement action, the company disclosed on Wednesday.

Uniswap’s native token, UNI, dropped 9.5% immediately after the news.

Uniswap CEO Hayden Adams announced the receipt of the so-called Wells notice on X, saying he wasn’t surprised, “just annoyed, disappointed, and ready to fight.”

Wells notices are preliminary warnings that inform respondents of the charges the regulator is considering bringing against them. They usually lead to enforcement actions.

In a press conference on Wednesday afternoon, Uniswap’s COO Mary-Catherine Lader and Chief Legal Officer Marvin Ammori told reporters that the content of the Wells notice was focused on Uniswap acting as an unregistered securities broker and unregistered securities exchange. It remains unclear whether Uniswap’s native token, UNI, was implicated as a potential security in the SEC’s notice.

KPMG Fined Record $25 Million in Exam-Cheating Scandal

KPMG’s Netherlands unit agreed to pay a $25 million fine over claims of exam cheating and misinforming investigators, the largest monetary penalty imposed on an auditing firm by the Public Company Accounting Oversight Board.

KPMG Accountants NV failed to take adequate steps to identify and investigate misconduct in which employees provided answers or access to questions on exams, in violation of the PCAOB’s quality-control rules, the U.S. audit regulator said Wednesday. The tests for the firm’s mandatory training courses, which cover topics such as U.S. audit standards, professional ethics and independence, are aimed at helping auditors maintain their professional certifications to perform certain types of audits.

The answer-sharing occurred from 2017 to 2022 and involved hundreds of professionals, including partners and senior leaders such as the now former head of assurance, Marc Hogeboom, the PCAOB said. The firm repeatedly misrepresented its knowledge of the misconduct to the PCAOB, the regulator said.

Top Crypto Exchanges Look to Move Beyond Settlements With U.S. Regulators

Chief compliance officers from three top cryptocurrency exchanges said they continue to make additional investments in compliance controls and staffing as they look to move on from settlements with U.S. regulators over various compliance failures.

Compliance chiefs at crypto exchanges Binance, Coinbase and Kraken said at an industry conference Wednesday that they also hope lessons from these settlement agreements could help improve compliance programs within the wider industry.

“In a sense, our settlement, with a massive fine and the requirements coming from that, probably is a model for others in the industry and will be an opportunity for us to continue to uplift the [compliance] program,” Noah Perlman, Binance’s chief compliance officer, said during a panel at blockchain analytics provider Chainalysis’s annual Links conference in New York.

Stock fraudster’s conviction does not outlive his death, US court rules

The U.S. Justice Department has lost its bid to convince a federal appeals court to break with its counterparts in other circuit courts and rule that a defendant’s conviction does not get wiped away just because he died while his appeal was pending.

The Boston-based 1st U.S. Circuit Court of Appeals on Tuesday joined, opens new tab with all 11 other regional federal appeals courts by recognizing a legal doctrine that requires former PixarBio Corp CEO Frank Reynolds’ securities fraud conviction to be scrapped because he died in 2022.

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He was sentenced in 2020 to seven years in prison and ordered to forfeit $280,000 and pay $7.55 million in restitution to his victims. Those financial orders will be vacated too, which means prosecutors now would need to pursue a new civil case against Reynolds’ estate to recover money for his victims.

The court’s ruling relied on the legal doctrine known as “abatement ab initio,” under which trial convictions are vacated when defendants die before they can exhaust their appeals, as Reynolds did.

House GOP Unveils Bill to Strike SEC Climate Disclosure Rule

House Republicans unveiled a bill Wednesday to nullify the Securities and Exchange Commission’s landmark corporate climate risk disclosure rule, joining a flurry of efforts in courts to kill the mandate.

The bill, introduced by Rep. Bill Huizenga (R-Mich.), would use the Congressional Review Act to overturn the rules, which are currently on pause. The commission froze implementation of its regulation April 4 while multiple legal challenges play out.