A recent litigation release reveals the SEC’s continued determination to use Section 304 of the Sarbanes-Oxley Act of 2002 to compel CEOs and CFOs of companies required to restate their financial statements to repay bonuses and other forms of compensation. The SEC has sought to force the return of such executive compensation without alleging and
Justice Defaulted: SEC Loses Its “First” Credit Default Swaps Insider Trading Action
In a detailed, 122-page opinion (pdf), U.S. District Court Judge John G. Koeltl systematically dismantled and dismissed the SEC’s first-ever credit default swap insider trading case. In SEC v. Jon-Paul Rorech and Renato Negrin (pdf), the SEC alleged that Deutsche Bank bond salesman, Jon-Paul Rorech, passed material, non-public information to a Millennium Partners…
SEC v. Goldman Sachs & Co. and Fabrice Tourre: A Back Door to Derivative Regulation?
There is good reason, beyond anger, voyeurism and schadenfreude, for Wall Street and “Main Street” to keep their eyes on the SEC enforcement action against investment banking firm Goldman Sachs & Co and one of its vice presidents, Fabrice Tourre.
According to the SEC’s complaint (pdf), Goldman was paid by one of the world’s largest hedge…
Global Research Analyst Settlement – What’s In and What’s Out
You need to follow along closely because this can get a bit confusing. As we all recall, in 2003, judgments were entered against 12 of the largest Wall Street firms that issued research and engaged in investment banking, commonly referred to as “The Global Settlement.” The Global Settlement imposed significant restrictions on interactions between the research analysts and investment bankers at these firms in order to stymie the bankers from influencing analyst coverage decisions.
The Global Settlement provided that with respect to any provision that had not been expressly superseded by subsequent rulemaking within five years, it was the expectation of the parties that, “the SEC would agree to an amendment or modification of such term, subject to Court approval, unless the SEC believes such amendment or modification would not be in the public interest.”
Ultimately, the parties agreed to seek Court approval to modify specific provisions, rather than all, of the Global Settlement. In an order issued March 15, 2010 (pdf), U.S. District Judge William H. Pauley III approved all of the parties proposed modifications, with the exception of one.