Fraud has reached epidemic levels in the UK and should be seen as a national security issue, says think tank the Royal United Services Institute (RUSI) in a paper published last week[1]. It is the crime to which UK citizens are most likely to fall victim[2]. Its impact on the private sector has consequences for both the stability of individual companies and the broader reputation of the UK as a place to do business.

85% of reported fraud in 2019/2020 was cyber enabled[3] fraud[4]. With limited in person interaction due to the pandemic, and increasing levels of remote working, this figure is expected to increase in the coming year. Cyber fraud is a constantly evolving area with perpetrators adapting their methods as new technologies become available. Common examples of cybercrime are denial of service (DoS), botnet, phishing, and ransomware attacks.

SEC v. GPB Capital Holdings, LLC, et al. was filed in the Eastern District of New York on February 4, 2021 by the SEC, alleging violations of federal law in connection with the defendants’ investment business, which allegedly raised over $1.7 billion from more than 17,000 investors. Specifically, the complaint alleges that the defendants violated the Investment Advisers Act, the Securities Act, and the Exchange Act, along with corresponding regulations.

Health Enterprise Partners (HEP) has announced it has completed an investment in Aware Recovery Care.

Aware Recovery Care, based in Wallingford, Conn., is a provider of in-home mental health and substance use disorder services in Connecticut, New Hampshire, Maine, Florida and Massachusetts. The company provides what it describes as the “full continuum of home-based…

As discussed in a prior McGuireWoods alert, the U.S. Department of Health and Human Services (HHS) published final rules that significantly amend the Physician Self-Referral Law (Stark Law), the federal Anti-Kickback Statute (AKS) and the Civil Monetary Penalties Law. The final rules discussed in this alert were originally given a Jan. 19, 2021, effective…

February 3, 2021 – Rotstain v. Mendez, 2021 WL 359989 (5th Cir.)

On February 3, 2021, the United States Court of Appeals for the Fifth Circuit issued an opinion in Rotstain v. Mendez, holding in part that a receiver had standing to bring claims on behalf of investors in connection with a Ponzi scheme.

In the context of denying a motion to intervene, Rotstain clarified that receivers and their assignees have standing to bring claims on behalf of investors when the investors’ claims are against alleged conspirators for conduct in furtherance of that scheme and are derivative of and dependent on the claims of the receivership estate.

Overview

Consolidated financial account reports can offer a broad – all-encompassing — view of customers’ investments regardless of where the assets are held and may even include non-securities assets. Customers often demand them and firms and financial advisers provide them. FINRA has had these types of communications to customers on its radar screen for years.

Equally, on FINRA’s radar screen for years has been the need to supervise regulatory functions outsourced to third party vendors. FINRA has frequently reminded firms that outsourcing regulatory functions does not relieve the firm of its compliance obligations and that firms must supervise the outsourced activity.

Data privacy laws have made significant breakthroughs in recent years, making it a top priority for businesses.  From the adoption of the European Union’s General Data Protection Regulation (GDPR) in 2016 to the enactment of the California Consumer Privacy Act (CCPA) in 2018 and the latest ballot approval of the California Privacy Rights Act (CPRA) in 2020, we continue to see data privacy laws develop and garner interest from consumers, businesses, and legislators alike.

Specific biometric privacy laws, in particular however, are often overshadowed by more general data privacy laws.  As we discussed in our prior article, biometrics are physical and behavioral human characteristics (i.e., face, eye, fingerprint, and voice features) that can be used to digitally identify a person.  As the collection and use of biometric data become more common in daily life and its applications in different industries continue to expand, new privacy considerations will emerge in this field.  Biometrics laws, in their own right, require separate recognition because of the nuanced application of these specific laws.

The United States does not have a single, comprehensive federal law governing biometric data.  Recently, we have seen an increasing number of individual states focus on this issue, and the recent introduction of legislation in a number of states specifically aimed at protecting the collection, retention, and use of biometric data.  In Part I, we summarize some of the legislative activity on biometric laws from 2020.  We will describe other noteworthy legislation to monitor for 2021 in Part II.