Securities Law

Fed’l Judge Blasts ‘Mean-Spirited’ Gov’t Memo Implying Bias for Wealthy Defendant

As he gave a high-profile defendant in an options-backdating case the probation and home confinement recommended in a presentence investigation, a federal judge in Los Angeles yesterday also offered a blistering critique of a prosecution memo urging him to send ex-KB Home CEO Bruce Karatz to the slammer. The sentencing…

Nov 11, 2010 9:29 PM CST

Book Sets Bizarre BofA Scene: GC Fired Over Pay Fuss; Lawyer Tells New Boss, You’re My 3rd GC Today

Some think of top in-house lawyers as masters of the universe, but a new book may help disabuse them of that notion. Written by Financial Times correspondent Greg Farrell, it contends that a former Bank of America Corp. general counsel, Tim Mayopoulos, was fired because he carped that those in…

Nov 5, 2010 6:59 PM CDT

Banks Draw Scrutiny From Feds and Chicago-Area Sheriff

A sheriff in Chicago says he’ll halt evictions by three lenders until they submit affidavits confirming that the paperwork was done properly. Cook County Sheriff Tom Dart said his foreclosure moratorium applies to Bank of America, J.P Morgan Chase and GMAC/Ally Financial, according to the Associated Press, Bloomberg and the…

Oct 20, 2010 4:05 PM CDT

SEC Proposed Rule Would Allow Nonbinding Shareholder Vote on CEO Pay

The U.S. Securities and Exchange Commission moved this week to enact a provision that would give investors a voice in CEO pay at U.S. corporations. Shareholders would get to vote on salaries and bonuses, though the vote would be nonbinding, Bloomberg reported. A company’s board of directors would always have…

Oct 20, 2010 12:24 AM CDT

Appeals Court Affirms Stiff $95K Sanction Against Lawyer, Client

A federal appeals court has affirmed a nearly $95,000 sanction against a New York lawyer and his client for knowingly filing a time-barred securities fraud suit. The 2nd U.S. Circuit Court of Appeals last week issued a summary order upholding the sanction imposed by U.S. District Judge Denis R. Hurley…

Oct 15, 2010 7:59 PM CDT

$156K Fee Award in $245M Case ‘On the Stingy Side’ But Upheld By 2nd Circuit

A $245 million federal securities class action settlement never would have been achieved but for its work in bringing the initial federal cases on which it was based, a Pennsylvania law firm contends. Even if that’s true, however, Chimicles & Tikellis is stuck with an attorney’s fee award of just…

Oct 15, 2010 10:00 AM CDT

Lawyer Introductions Led to $550K Fine for Manatt Phelps in NY Pension Fund Case

Updated: A California law firm has agreed to pay $550,000 to the state of New York and refrain from appearing before public pension funds there for the next five years, after several unidentified partners introduced, or tried to introduce, financial firms seeking money to several of the institutional investors. Although…

Oct 12, 2010 8:22 PM CDT

Ex-Attorney Rothstein’s Right-Hand Woman Gets 10 Years in $1.4B Ponzi Scheme

Exceeding the prosecution’s recommendation of a seven-year sentence, a federal judge in South Florida today imposed a 10-year prison term on an aide to ex-attorney Scott Rothstein for her role in his approximately $1.2 billion Ponzi scheme, in which he sold expected income from fake legal settlements. Debra Villegas, 43,…

Oct 8, 2010 5:24 PM CDT

US Claims Facebook, Twitter Used in Pump-and-Dump Stock Scheme

Prosecutors say they discovered a multimillion dollar “pump and dump” scheme that used social media to tout stocks during an investigation of suspected cocaine trafficking by longshoremen. The Manhattan U.S. Attorney’s office claims the defendant used websites, Facebook and Twitter to spur investors to buy penny stocks, Reuters reports. One…

Oct 6, 2010 11:27 AM CDT

Court’s Sentence Makes Rogue Trader Kerviel a Six-Billion-Dollar Man

Jerome Kerviel was sentenced to what is locally considered a hefty three-year prison term today by the main criminal court in Paris, and ordered to repay his employer, Societe General, nearly $7 billion in a record-breaking rogue trading case at the bank. Although the 33-year-old defendant and some observers blamed…

Oct 5, 2010 11:41 PM CDT

Law Giving BP Cleanup Responsibility Created ‘Cognitive Dissonance,’ Admiral Says

The admiral in charge of overseeing the response to the BP oil spill says federal laws that put the company in charge of the cleanup created a perceived conflict between the company’s duties to the public and to its shareholders. Speaking in New Orleans last week at a meeting of…

Oct 5, 2010 4:35 PM CDT

SEC Attorney on Billionaire Stanford’s Case Pleads No Contest to Resisting Arrest

Securities and Exchange Commission attorney J. Kevin Edmundson pleaded no contest this week to a misdemeanor charge of resisting arrest that stemmed from a clash with Fort Worth police officers in April 2009 that landed one officer a punch in the eye. Edmundson was given six months of deferred adjudication,…

Oct 1, 2010 11:15 PM CDT

Federal Judge Orders Class Counsel to Try for More Diverse Legal Team

A federal judge is apparently disappointed with the makeup of the legal team of two securities law firms serving as co-lead counsel in a pending class action. U.S. District Judge Harold Baer of New York issued an unusual order on Monday urging two law firms to assign at least one…

Sep 23, 2010 2:45 PM CDT

SEC Inspector General Says Timing of Goldman Case Was ‘Suspicious’

The inspector general of the Securities and Exchange Commission said Wednesday that the timing of the agency’s civil fraud case against Goldman Sachs was “suspicious.” SEC inspector general David Kotz suggested the case may have been used to divert attention from his critical report on the agency’s handling of the…

Sep 23, 2010 2:16 PM CDT

Ex-Hinshaw Partner Accused of Investor Fraud

A former partner at Hinshaw & Culbertson has been accused along with two executives of a real estate lending fund of defrauding investors who put $21 million into the fund after its sole borrower defaulted. According to the civil complaint (PDF) filed by the Securities and Exchange Commission, lawyer Todd…

Sep 22, 2010 12:45 PM CDT