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Banking/Financial Services

Aug 01, 2022

Who Are You? Auditor or Consultant, And Nonetheless Cheating on Exams

As reported by Bloomberg, at a PLI conference in October of 2021 the Acting Chief Accountant of the U.S. Securities and Exchange Commission (“SEC”), Paul Munter, issued a statement concerning the requirements found in SEC rules that, an auditor who is attesting to the accuracy of client financial statements, must be independent of the client. » Read More

Jul 25, 2022

Mony a Mickle Maks a Muckle: SEC Charges Foreign Nationals with Two Microcap Frauds

On Tuesday, April 18, 2022, the U.S. Securities and Exchange Commission (“SEC”), in three separate lawsuits brought in the U. S. District Court for the Southern District of New York, charged 16 defendants (one company and 15 individuals) located in the Bahamas, the British Virgin Islands, Bulgaria, Canada, the Cayman Islands, Monaco, Spain, Turkey, and the United Kingdom, for running multi-year fraudulent penny stock schemes that produced over $194 million of illegal receipts.» Read More

Jul 15, 2022

Fingers in the Till: SEC Charges Texas City Administrator with Falsified Financial Statements to Conceal Embezzlement

Johnson City, Texas, is a city in the very middle of the Texas Hill Country, with a 2020 population of 1627. Johnson City was incorporated in 1879 and named after its founder, Sam E. Johnson, a Texas rancher. It lies amid the so-called “Texas-German” Belt, which originated due to the many German immigrants arriving from 1830 on.» Read More

Jul 11, 2022

Stealing From the Weak: SEC Charges Fraudulent Operation of Special Needs Pooled Trusts

On Monday, May 2, 2022, the U.S. Securities and Exchange Commission (“SEC”) filed fraud charges in the U.S. District Court for the Middle District of Florida against Synergy Settlement Services, Inc. (“Synergy”); its CEO, who is also an attorney and principal of a law firm; and, in addition, Synergy’s President, for defrauding individuals with disabilities into believing that their funds were being placed in one of two pooled trusts managed by a non-profit association.» Read More

Jun 27, 2022

Serving the Public? SEC Charges Two Municipalities and Their Leaders with Bond Fraud

I have written previously about the recurring problem of fraudulent financial information used to market and sell municipal securities. See my Sept. 22, 2020, Blog “SEC Focus on Municipal Securities: Disclosure and Enforcement – the Peculiar Structure of the Municipal Securities Disclosure Regime”; my March 2, 2021, Blog “Being Held Accountable: The ‘Education’ of KPMG at the College of New Rochelle”; and by April 28, 2022, Blog “Failing Grades: School District and Auditor Earn SEC Discipline.” » Read More

Jun 20, 2022

Changing the Game: SEC Brings Enforcement Action for Exchanging Annuities

On Monday, May 25, 2022, the U.S. Securities and Exchange Commission issued an Order Instituting Administrative and Cease-And-Desist Proceedings (“Order”) against RiverSource Distributors, Inc. (“RDI”) with respect to exchanges it made with existing customers between January 2017 and May 2018 of variable annuities.» Read More

Mar 15, 2022

Maximizing the Fee: Royal Bank of Canada Affiliate Pays $30+ Million for Client Abuse

On Thursday, March 3, 2022, the U.S. Securities and Exchange Commission (“SEC”) announced that City National Rochdale, LLC (“CNR”), a Delaware statutory trust sponsoring proprietary mutual funds and serving as their investment adviser, agreed to pay $30,361,803 to settle charges brought by the SEC that the trust had failed to disclose conflicts of interest that defrauded current and prospective clients.» Read More

Dec 09, 2021

“Call the Plumber”: Bank for International Settlement AND IOSCO Call for Reforms

On Monday, November 29, 2021, the Committee on Payments and Market Infrastructures (“CPMI”) of the Bank for International Settlements (“BIS”), together with the International Organization of Securities Commissions (“IOSCO”), issued a joint Report on clearing facilities operating around the world, and requesting, by January 24, 2022, comments particularly focusing on client access and “portability.”» Read More

May 11, 2021

Friends and Family Fraud: LLC Does It

On Wednesday, May 5, 2021, the U.S. Securities and Exchange Commission (“SEC”) instituted an administrative proceeding under Rule 102(e) of the SEC Rules of Practice against Seth P. Levine, Esq., a 52-year-old New Jersey attorney (also admitted in New York) residing in Teaneck, Bergen County, New Jersey, regarding charges of fraud through his LLC.» Read More