McKinsey Fined $18M Over Compliance Failures

McKinsey & Co. has agreed to pay $18 million for failing to establish appropriate boundaries between its consultants and an affiliate that makes investments for them.The U.S. Securities and Exchange Commission said McKinsey partners had access to material nonpublic information (MNPI) about is...

By Matthew Heller • Nov. 19, 2021

FTC Has ‘Concerns’ About Nvidia Deal to Buy Arm

Nvidia has indicated that the U.S. Federal Trade Commission is moving ahead with an antitrust investigation of its $40 billion offer to acquire U.K. chip designer Arm.In a commentary on Nvidia’s third-quarter results, CFO Colette Kress disclosed Wednesday that FTC regulators had “expressed concer...

By Matthew Heller • Nov. 18, 2021

SEC Enforcement Activity Drops 15% in 2021

U.S. Securities and Exchange Commission enforcement actions against public companies and subsidiaries fell to the lowest level in seven years in fiscal 2021, reflecting in part the continuing impact of the COVID-19 pandemic.The NYU Pollack Center for Law & Business and Cornerstone Research sa...

By Matthew Heller • Nov. 17, 2021

JPMorgan Sues Tesla in Stock Warrant Dispute

JPMorgan Chase has filed a $162 million lawsuit alleging Tesla reneged on a stock warrant deal after the investment firm lowered the strike price.The suit for breach of the 2014 deal agreement centers on a dispute over JPMorgan’s re-pricing of the warrants in 2018 as a result of Tesla CEO Elon Mu...

By Matthew Heller • Nov. 16, 2021

Why Tesla Appears to Be Feeling the Pinch Of Supply Chain Constraints

Tesla has so far weathered supply chain constraints fairly well but it looks like the industry-wide issue is coming back to haunt the company.Tesla said in its third-quarter earnings statement that it continues to run its production lines as close to full capacity as conditions allow despite the ...

By Vincent Ryan • Nov. 15, 2021

McKinsey Consultant Accused of Insider Trading

A former partner at consulting firm McKinsey & Co. has been charged with trading on inside information he had obtained about the potential acquisition of GreenSky Inc. while advising the buyer about the deal.The U.S. Securities and Exchange Commission said Puneet Dikshit, who worked for McKin...

By Matthew Heller • Nov. 10, 2021

PCAOB Revamped With Four New Members

The U.S. Securities and Exchange Commission has appointed a new chair of the Public Company Accounting Oversight Board and three new members as part of a sweeping overhaul of the regulator.The revamp announced on Monday came five months after the SEC abruptly removed William Duhnke as chair and l...

By Matthew Heller • Nov. 9, 2021

Jury Clears Priest in ‘Short-and-Distort’ Scheme

A jury has found that a Greek Orthodox priest who manages a hedge fund made false statements about a biotech firm but did not engage in a “short-and-distort” scheme to defraud investors.The verdicts in the case against Rev. Emmanuel Lemelson gave only a partial victory to the U.S. Securities and ...

By Matthew Heller • Nov. 8, 2021

Four Kinds of Documents Every Private Company Should Have

Maintaining a clean and tidy house is the foundation for successful home life. When everything is in order, things operate smoothly. A privately held business must also keep its “house” in order. But what does that mean?Every company should have certain vital documents in place to steer it in the...

By Vincent Ryan • Nov. 8, 2021

Feds Sue to Block “Big Five” Publishing Merger

The U.S. Department of Justice has sued to block Penguin Random House’s proposed $2.18 billion acquisition of Simon and Schuster, saying the merger of two of the “Big Five” book publishing companies would harm authors and consumers.In an antitrust complaint filed on Tuesday, the DOJ said the deal...

By Matthew Heller • Nov. 3, 2021

Music Streamer Settles SPAC Fraud Case

Akazoo, a Greek firm purporting to be a music streaming service, has agreed to pay $38.8 million to settle allegations that it defrauded investors both before and after it went public through a SPAC merger.The U.S. Securities and Exchange Commission said Akazoo grossly misrepresented the nature a...

By Matthew Heller • Oct. 28, 2021

Does the SEC Care if You’re Green?

One year after issuing controversial guidance for following environmental-risk disclosure rules, the Securities and Exchange Commission appears to have given the matter little attention.In a review of comments to regulatory filings made in 2010, law firm Davis Polk found only six instances of SEC...

By Sarah Johnson • Oct. 28, 2021

Starting on the Path to Net-Zero Emissions

The urgency around global warming and climate change is increasing worldwide, with public and private entities feeling pressure to reduce their carbon footprints. According to the recent UN Climate Change Report, limiting human impact on global warming requires reaching at least net-zero CO2 emis...

By Vincent Ryan • Oct. 27, 2021

U.S. Insurance Pricing Rises 14% in Q3

Insurance pricing increases moderated across most geographic regions in the third quarter but accelerated in the U.S. amid a surge in cyber insurance pricing.According to the latest Global Insurance Market Index from Marsh, pricing rose 15% globally for a second straight quarter due to a slower r...

By Matthew Heller • Oct. 26, 2021

Small Business CFOs Must Build Ethical Awareness

Whether you work for a large public company or a smaller private one, the pressure to deliver results can be intense. Wall Street expects growth, the board of directors expects annual plans to be achieved, and owners expect a return on their investment, especially those who have put their life sa...

By Steve McNally • Oct. 20, 2021

Limit ESG Disclosures to Cash-Flow Impacts: Economists

Should the Securities and Exchange Commission write rules that require disclosure of greenhouse gas (GHG) emissions from a company’s operations and, possibly, its entire value chain? Not if those emissions don’t affect the company’s financial performance, says the Financial Economists Roundtable....

By Vincent Ryan • Oct. 11, 2021

Will the SEC Finally Approve a Tougher Clawback Rule?

During a recent speech, Securities and Exchange Commission Chair Gary Gensler said he would be pushing his staff to recommend rules for clawing back public company executive pay.The idea that executives — initially, CFOs and CEOs — should return certain kinds of compensation to their publicly-hel...

By Vincent Ryan • Oct. 11, 2021

Hemp Startup Founders Accused of Stock Fraud

The two co-founders of CanaFarma Hemp Products have been charged with fraudulently raising $15 million from investors by making false statements about the “farm to table” hemp startup and its management.The U.S. Securities and Exchange Commission said Vitaly Fargesen and Igor Palatnik misrepresen...

By Matthew Heller • Oct. 6, 2021

Ex-Goldman Compliance Analyst Accused of Insider Trading

A former senior compliance analyst at Goldman Sachs has been charged with abusing his position of trust to make more than $471,000 in profits from insider trades.The U.S. Securities and Exchange Commission said Jose Luis Casero Sanchez, a Spanish national, had access to highly sensitive informati...

By Matthew Heller • Sept. 29, 2021

Wells Fargo Fined $37M Over Forex Fraud

For the second time this month, Wells Fargo has reached a settlement with the U.S. government, agreeing to pay a $37.3 million fine for overcharging customers of its foreign exchange service.According to the Department of Justice, Wells Fargo sales specialists systematically charged forex custome...

By Matthew Heller • Sept. 28, 2021

Fed Regional Chiefs Resign Amid Ethics Outcry

Two top U.S. Federal Reserve officials have resigned amid an outcry over personal investment activities that raised ethical concerns.The resignations of Robert Kaplan, president of the Dallas Fed, and Eric Rosengren, president of the Boston Fed, came less than two weeks after the public disclosur...

By Matthew Heller • Sept. 28, 2021

Ad Giant WPP Fined $19M for FCPA Violations

U.K.-based WPP, the world’s largest advertising group, has agreed to pay $19 million to settle charges that it failed to properly supervise subsidiaries in foreign countries, resulting in bribery and other illicit schemes.The U.S. Securities and Exchange Commission said WPP violated the Foreign C...

By Matthew Heller • Sept. 24, 2021

Subprime Auto Securitization Was a ‘House of Cards’

The two former principals of subprime auto lender Honor Finance have been charged with defrauding investors by misrepresenting the quality of loans that they packaged into a $100 million securities offering.The U.S. Securities and Exchange Commission said CEO James Collins and Chief Operating Off...

By Matthew Heller • Sept. 24, 2021

Coinbase Shelves ‘Lend’ Amid SEC Pushback

Coinbase has decided to scrap its plan to offer customers a digital asset lending platform rather than risk a legal showdown with the U.S. Securities and Exchange Commission.The crypto firm’s decision not to proceed with the Coinbase Lend product came less than two weeks after Coinbase blasted th...

By Matthew Heller • Sept. 21, 2021

SEC Brings First Crowdfunding Fraud Case

The U.S. Securities and Exchange Commission has brought its first enforcement action against promoters of crowdfunding offerings, alleging three people defrauded investors of more than $1.9 million.In a civil complaint filed on Monday, the SEC said Robert Shumake and his associates Willard Jackso...

By Matthew Heller • Sept. 20, 2021