These are some of the compliance-related stories that recently caught my attention. An Eerie Silence by David Kirk in McGuireWood’s The Fraud Board There’s an eerie silence in the world of fraud prosecutions in the UK. A Libor trial is about to start, a FCA land banking prosecution is on trial at Southwark, but with … Read more »
Sure Fire Way To Spot a Fraud: Look for the SEC Seal
The Securities and Exchange Commission does not “approve” or “endorse” any particular securities, issuers, products, loans, services, professional credentials, firms or individuals. The SEC does not allow private entities to use its government seal. Yes, the staff of the SEC regularly meets with public companies, regulated entities, and others. Some of these investments and entities … Read more »
Personal Foul Called on Athlete Lending Firm
A professional athlete’s cash flow can be choppy. As an ex-NFL player, Will Allen knew about the cash flow problems. He also realized that fans could be lured into being lenders to professional athletes. It looks like Allen miscalculated the amount of investor interest against athletes looking for loans. The Securities and Exchange Commission charged … Read more »
The Producers Success and Oil Wells
In The Producers, Max Bialystock and Leo Bloom realize they can make more money with a flop than a hit. No one audits a flop and the fraudsters are free to flee with their investors’ money. According to the Securities and Exchange Commission, GC Resources, LLC and Brian J. Polito was trying to run a … Read more »
Norman Leventhal
Norman Leventhal, the founder of my firm, passed away this weekend. Norman had a tremendous influence on Boston. His legacy will be with us for generations. He developed or re-develeped some of Greater Boston’s best-known landmarks: Rowes Wharf, Center Plaza, the Hotel Meridien, 75 State Street, and South Station. He formed the Norman B. Leventhal … Read more »
SEC Action for Stifling Whistleblowers in Confidentiality Agreements
A story surfaced a few weeks ago that the Securities and Exchange Commission was taking a close look at employment agreements that limited the actions of whistleblowers. The story behind the story came out. The SEC brought an action against KBR, Inc. for violating whistleblower protection Rule 21F-17 enacted under the Dodd-Frank Act. KBR required … Read more »
April 1
A reminder to look at your calendar before trusting the news or a strange situation today. For fun, try Google Maps and look for the Pac-Man option. For shopping, try to figure which new item at ThinkGeek is real (if any) Read more »
SEC Brings a Valuation Case Against an Investment Adviser
Lynn Tilton and her firm, Patriarch Partners, are known for their high-risk, high-return investments in distressed companies. The Securities and Exchange Commission brought a case against her and the firm claiming that they were using improper valuations, failing to mark down assets when the investment became more distressed. At this point we only have the … Read more »
A New Exception to the Custody Rule
The Custody Rule can be difficult for private equity and real estate fund managers to navigate. When I see some regulatory relief or clarification I hope for the best. 16th Amendment Advisors received relief for one of its funds based its particular circumstance Could that relief may be useful for other fund managers? That’s not … Read more »
Weekend Reading: Argo
In 1979, Iranian militants stormed the American embassy in Tehran and captured dozens of American, holding them hostage for 444 days. Six Americans escaped and hid in the home of the Canadian ambassador. A top-level CIA officer named Antonio Mendez devised an ingenious yet incredibly risky plan to rescue them before they were detected. You … Read more »