• September 19, 2014

    Petters Feeder Funds, Manager Won't Get New Trial

    A Minnesota federal judge on Friday refused to grant a new trial to a fund manager who fed hundreds of millions into Thomas Petters’ $3.5 billion Ponzi scheme, rejecting arguments the jury’s verdict was inconsistent.

  • September 19, 2014

    Accountant Gets 40 Months For Texas Lender Takeover Plot

    A Pennsylvania accountant was sentenced on Friday to 40 months in prison for conspiring with reputed members of the Lucchese organized crime family to takeover a Texas-based mortgage lender through extortion and drain it of $12 million, forcing the lender into bankruptcy.

  • September 19, 2014

    Rothstein Lawyer, Broker Charged In $2.4M Fraud Scheme

    Florida federal prosecutors on Friday charged an attorney and a broker connected to Rothstein Rosenfeldt Adler PA of being part of convicted Ponzi schemer Scott Rothstein’s $1.2 billion scam, claiming the pair caused investors to lose $2.4 million.

  • September 19, 2014

    Texas Investment Adviser Gets 20 Years For Ponzi Scheme

    A former investment adviser was sentenced Thursday to 20 years in Texas state prison after being convicted of securities fraud and theft stemming from a Ponzi scheme, in which he solicited clients' investment in gold, silver and commodities and used the funds for personal expenses, according to a state regulator.

  • September 19, 2014

    FINRA Floats Rules On Recruitment Disclosure, Transparency

    The Financial Industry Regulatory Authority on Friday said it plans to propose a new set of rules requiring firms to provide educational information to customers of brokers they recruit from competitors, alongside a wide array of regulations aimed at increasing the transparency of the equity and fixed-income markets.

  • September 19, 2014

    Gov't Derides BofA Challenge Of Mortgage Fraud Verdict

    Bank of America Corp.'s attempt to overturn a New York federal jury's verdict that it defrauded Fannie Mae and Freddie Mac through an expedited mortgage-issuing program — prompting a $1.3 billion fine — defies "the evidence, the law and common sense," the government argued Friday.

  • September 19, 2014

    Notes' Assignee Can't Sue Over Telecom Collapse, Judge Says

    A New York judge on Wednesday dismissed claims brought by an assignee of notes for defunct Hellas Telecommunications Sarl from suits seeking to recover €102 million ($131 million) pocketed by two private equity firms while allegedly driving the telecom into insolvency, finding the assignee lacks standing.

  • September 19, 2014

    Allergan Defends Redactions In Valeant Insider Trading Suit

    Allergan Inc. on Thursday asked a California federal court to reject Valeant Pharmaceuticals International Inc.'s attempts to bar it from redacting documents in its insider trading suit against Valeant, saying its rival only wants the documents to help a $53 billion hostile takeover bid. 

  • September 19, 2014

    Software Startup CEO Gets 27 Months For Securities Fraud

    The CEO of software development startup Wwebnet Inc. was sentenced to 27 months in prison Thursday for bilking investors out of $2 million that was meant to get the company’s online entertainment platform off the ground, the U.S. attorney’s office in Manhattan announced.

  • September 19, 2014

    Auditing Co. Can’t Ax Broker-Dealer’s Suit Over $66M Fraud

    A New Jersey judge on Friday refused to toss Direct Access Partners LLC's suit accusing auditing firm Rothstein Kass & Co. PC of negligence for missing a $66 million foreign trading and bribery fraud that contributed to its parent company's bankruptcy, paving the way for discovery, an attorney for the broker-dealer said.

  • September 19, 2014

    Morgan Stanley Can't Boot $32M Securities Suit Out Of NY

    A New York judge has refused Morgan Stanley's bid to dismiss on jurisdictional grounds a lawsuit alleging it sold a Singaporean financial services corporation $72 million worth of doomed securities and profited off their failure, ruling that the case has sufficient ties to the state.

  • September 19, 2014

    2nd Circ. Tosses Citibank Appeal Of Argentina Bond Ruling

    The Second Circuit on Friday dismissed Citibank NA's appeal of a New York federal judge's order preventing it from processing an upcoming payment on $8.4 billion in Argentine sovereign debt, a day after the bank's lawyer argued that the lower court's ruling has "put a gun to our head."

  • September 19, 2014

    SEC Hits ITT Educational Services With A Wells Notice

    Enforcement attorneys at the U.S. Securities and Exchange Commission are preparing to recommend that for-profit technical institute ITT Educational Services Inc. face charges over two of its private loan programs, according to a Wells notice that ITT said it received.

  • September 19, 2014

    Ex-Owner of Mass. Trading Co. Gets 9 Yrs For Forex Fraud

    The former owner of Boston Trading and Research LLC was sentenced to nine years in prison on Tuesday after pleading guilty in Massachusetts federal court to defrauding more than 700 investors out of more than $30 million after recruiting them to open foreign currency exchange accounts.

  • September 19, 2014

    Petroleum Development Reaches $30M Deal With Class

    In a deal worth at least $30 million, Petroleum Development Corp. has settled with a certified class of several thousand investors who accused the energy company in California federal court of shortchanging them when it bought back their stakes in undeveloped Colorado oil properties, the company reported Friday.

  • September 19, 2014

    Nomura Sued Again Over Accusations Of Shabby MBS

    Nomura Credit & Capital Inc. has been hit with a fifth New York state court suit over its sale of mortgage-backed securities to a trust purpose built for Nomura MBS and trusteed by HSBC Bank USA NA, this time over more than $613 million worth of loans the plaintiffs say were materially misrepresented.

  • September 19, 2014

    UK Appeals Court Upholds Innospec Bribery Convictions

    A U.K. appeals court on Friday upheld the convictions of two former Innospec Ltd. executives over their roles in a bribery scheme designed to drum up business in Indonesia and Iraq, but reduced one of their prison terms from four years to three.

  • September 18, 2014

    BMO Harris Socked With $24B Suit Over Petters Ponzi Scheme

    A trustee for two bankrupt Florida investment firms on Thursday hit BMO Harris Bank NA with a $24 billion adversary suit, alleging its Marshall & Illsley Bank helped convicted Ponzi scammer Thomas Petters bilk investors out of $3.7 billion.

  • September 18, 2014

    Greenberg Traurig, Alvarez Agree to Slash TelexFree Fees

    Greenberg Traurig LLP and Alvarez & Marsal NA LLC, the respective former bankruptcy counsel and financial adviser for accused Ponzi schemer TelexFree LLC, agreed Wednesday to reduce their pay by a total of roughly $1 million in exchange for the U.S. Securities and Exchange Commission not opposing their fee applications.

  • September 18, 2014

    Virtual Bank Founder Must Pay $40M For Bitcoin Ponzi Scheme

    A Texas federal judge on Thursday ordered Bitcoin Savings & Trust and its founder to pay more than $40 million in disgorgement and penalties, ruling that the U.S. Securities and Exchange Commission showed they defrauded investors by running a Ponzi scheme involving the bitcoin virtual currency.

Expert Analysis

  • Next Big Thing For Foreign Cos. — Yield-Oriented US IPOs

    Sean T. Wheeler

    The flexibility and access to capital available through master limited partnerships and yieldcos should result in a meaningful increase in yield-oriented U.S. initial public offerings by international companies. Many companies, however, irrationally fear the U.S. Securities and Exchange Commission’s process for registration statement review, says Sean Wheeler of Latham & Watkins LLP.

  • 4 Hot Issues In 3rd-Party Due Diligence

    Michael Volkov

    Lawyers who deal with anti-corruption risks and third parties have passed around standard clauses they like to use in their agent and distributor contracts. But taking a more creative approach to contract drafting is an important way to minimize risk, says Michael Volkov of The Volkov Law Group LLC.

  • 5 Takeaways From SEC's Filing Violation Sweep

    Nicolas Morgan

    The U.S. Securities and Exchange Commission’s having hit pay dirt — 34 defendants and $2.6 million in civil penalties — from the application of quantitative analysis portends further, future applications, including in the area of financial fraud, say Patrick Hunnius and Nicolas Morgan of DLA Piper.

  • Settling After Class Denial — If Only It Were That Easy

    Michael V. Rella

    The denial of class certification, while significant, does not conclusively dispatch a class claim. The class claim might reappear even after the defendant settles with the former lead plaintiff and the final judgment is entered, say James Goldfarb and Michael Rella of Murphy & McGonigle PC.

  • Forum Selection Bylaws Are Best Considered On A Clear Day

    Michael G. O’Bryan

    An Oregon court’s decision in Roberts v. TriQuint SemiConductors Inc. shows that enacting an exclusive forum provision on a clear day, before a company sees the storm clouds of litigation on the horizon, may support the enforceability of the provision, say attorneys with Morrison & Foerster LLP.

  • Scotland — The 'Succession Event' Question

    James Duncan

    A vote for an independent Scotland will have many consequences for the United Kingdom. Unsurprisingly, the implications for U.K. sovereign credit default swaps have not featured prominently in the public debate, say attorneys with Shearman & Sterling LLP.

  • Bandfield Confirms Aggressive FATCA Enforcement Tactics

    Miriam L. Fisher

    The scheme detailed in the U.S v. Robert Bandfield indictment follows a well-worn path of prior offshore financial frauds, but the prosecutors’ focus on the defendants’ alleged attempt to avoid compliance with the Foreign Account Tax Compliance Act sends a strong message to the global financial community, say Miriam Fisher and Brian McManus of Latham & Watkins LLP.

  • Readying For A New First Monday

    Fred T. Isquith

    Fall is in the air. September is flying by. In a few weeks the U.S. Supreme Court will be convening again. But while there are securities cases on the docket, there is nothing as momentous as Halliburton, says Fred Isquith of Wolf Haldenstein Adler Freeman & Herz LLP.

  • 2nd Circ. Ruling Clears FINRA Arbitration Confusion

    Jeff Kern

    The Second Circuit’s decision in Citigroup Global Markets Inc. v. Abbar provides an efficient framework for determining whether the Financial Industry Regulatory Authority’s mandatory arbitration rule is applicable to investor-initiated claims, and should serve to diminish the sort of “sprawling litigation” that transpired there, say Jeff Kern and Manuel Gomez of Sheppard Mullin Richter & Hampton LLP.

  • OPINION: Pro Bono May Help Diversity Recruiting Efforts

    David A. Lash

    A recent Law360 article about the perennial BigLaw concern over how to recruit and retain female and ethnically diverse attorneys addressed a new approach being taken by some law firms — going beyond traditional mentoring programs by creating a sponsorship relationship. Pro bono can also play a part, say David Lash and Merle Vaughn of the Association of Pro Bono Counsel.