SEC's Grewal on Cooperation: It's No Longer "If We’ll Find Out About a Violation, but When”

SEC Enforcement Chief: ‘It’s No Longer Really a Question of If We’ll Find Out About a Violation, but When’

“I’m also sure that there are those lawyers in this room, and maybe even clients that say, ‘Hey, we’ll just take our chances that the SEC doesn’t find out or learn of a violation. Or if they do, we will cooperate at that point.’” Grewal said.

“While you may have thought out the probabilities in your own heads, I think that’s a very risky gamble. One that becomes riskier and riskier each and every day, and the odds are increasingly in our favor,” Grewal said.

“That’s because given the success of the commission’s whistleblower program, given our improved use of data analytics, given our increased use of sweeps and risk-based initiatives, it’s no longer really a question of if we’ll find out about a violation but when.”

Private-Equity Giants Near Settlements With SEC Over Texting Violations

Some of Wall Street’s biggest private-equity firms said they are negotiating settlements with the U.S. markets regulator over their employees’ use of banned communication channels.

Blackstone, TPG and Carlyle Group disclosed in their latest quarterly filings that they have been cooperating with the U.S. Securities and Exchange Commission’s record-keeping investigations and have begun discussions with the agency’s enforcement staff about potential resolutions.

‘Queen of Mobile Homes’ Owes SEC Nearly $14 Million, Court Says

The SEC is entitled to a default judgment against a Texas woman who allegedly ran a mobile home investment scam, a federal court said in ordering almost $14 million in disgorgement, interest, and penalties.

Chimene Van Gundy is also subject to injunctions prohibiting her participation in the offer or sale of securities, Judge Fred Biery said in the order docketed Thursday in the US District Court for the Western District of Texas.

The Securities and Exchange Commission alleged that Van Gundy, who marketed herself as “the Queen of Mobile Homes,” ran an $18.5 million Ponzi scheme, using the investors’ money ….

Facebook, NVIDIA Securities Cases Deserve Supreme Court Reversal

The US Supreme Court is considering hearing appeals in two securities cases: NVIDIA v. E. Ohman J:OR Fonder AB and Facebook v. Amalgamated Bank. Both present critical issues under the federal securities laws that we believe the court must review and ultimately reverse.

Defendants in each case want the justices to reverse a ruling from the US Court of Appeals for the Ninth Circuit that allowed claims brought against them under the federal securities laws to proceed. The court is expected to review the petitions in the coming weeks.

The cases present an opportunity for much-needed clarity on theories of liability that corporations and executives routinely face in securities lawsuits—and about which courts, regrettably, continue to reach different conclusions.

What Do Plaintiffs’ Lawyers’ Pre-Filing Press Releases Signify?

One of the procedural innovations the PSLRA introduced was the requirement that plaintiffs’ counsel who file a securities class action lawsuit complaint must issue a press release announcing the complaint’s filing and notifying prospective class members of the opportunity to seek to become lead plaintiff. Plaintiffs’ lawyers quickly realized the potential publicity value for them from this exercise. Over time, related practices have developed, including the now commonplace practice in which plaintiffs’ lawyers issue a press release before they have filed a suit, announcing that they are “investigating potential claims.” While this practice is now familiar, it is still worth considering what the pre-suit communication tells us about the prospective lawsuit.

In a recent paper, four academics have examined this question; their article concludes that what the authors call “plaintiff’s attorney marketing” not only signals the likelihood of future litigation, but also may indicate severity of the litigation….

Tesla shareholders advised to reject Musk’s $56 billion pay

Proxy advisory firm Glass Lewis said on Saturday it has urged Tesla shareholders to reject a $56 billion pay package for Chief Executive Officer Elon Musk, which if passed would be the largest pay package for a CEO in corporate America.

The report cited reasons like the “excessive size” of the pay deal, the dilutive effect upon exercise and the concentration of ownership. It also mentioned Musk’s “slate of extraordinarily time-consuming projects” which have expanded with his high-profile purchase of Twitter, now known as X.

Coinbase Slugs It Out With U.S. SEC in Effort to Get Key Crypto Question Answered

After the company’s effort to dismiss the SEC’s enforcement case against it was rejected in federal court, Coinbase lawyers on Friday filed for a so-called interlocutory appeal that seeks to get one question considered at the next level up: Is a digital asset transaction that poses no obligation to the original issuer of the asset an investment contract regulated by the SEC?

Coinbase’s filing described the query as “a novel legal question in a regulatory action against a market leader that could shape or distort a multi-trillion-dollar industry.”