Nikola Fined $125M for Investor Fraud

Electric vehicle maker Nikola has agreed to pay $125 million to settle charges that it misled investors about key aspects of its business, including its technology and a partnership with General Motors.The settlement with the U.S. Securities and Exchange Commission came five months after Nikola’s...

By Matthew Heller • Dec. 21, 2021

Walmart Sued for Illegal Toxic Waste Disposal

California officials have sued Walmart for allegedly dumping hazardous waste improperly at municipal landfills over the past six years.Since February 2015, the retail giant has illegally disposed of waste including alkaline and lithium batteries, insect killer sprays and other pesticides, aerosol...

By Matthew Heller • Dec. 21, 2021

Ex-McDonald’s CEO Repays $105M Severance Deal

Former McDonald’s CEO Steve Easterbrook has returned a severance package valued at $105 million to the company, ending an unusual legal battle that erupted after he was fired for sexual misconduct.McDonald’s announced on Thursday that it had settled the lawsuit it filed against Easterbrook in Aug...

By Matthew Heller • Dec. 16, 2021

SEC Proposes Tighter Insider Trading Rule for Execs

The U.S. Securities and Exchange Commission on Wednesday proposed tightening a rule that shields corporate executives from insider trading liability for making trades as part of a pre-announced portfolio management plan.Rule 10b5-1 applies to plans executed by a third party and set up at a time w...

By Matthew Heller • Dec. 15, 2021

Large Employers Hesitant About Vax Mandate

Most large U.S. employers do not appear to be motivated to require employees to be vaccinated against COVID-19 unless the Biden administration’s mandate survives legal challenges.In a survey of 1,000 of its members, the Society for Human Resources Management found that 75% of those subject to the...

By Matthew Heller • Dec. 14, 2021

FDIC Leaders Clash Over Bank Merger Policy

FDIC Chair Jelena McWilliams The Federal Deposit Insurance Corp. rebuked two Democratic members of its board on Thursday after they said the agency would seek public comment regarding its regulation of bank mergers.The announcement by Consumer Financial Protection Bureau Director Rohit Chopra and...

By Matthew Heller • Dec. 10, 2021

SEC Chief Outlines Possible SPAC Reforms

SEC Chair Gary Gensler U.S. Securities and Exchange Commission Chair Gary Gensler said Thursday that SPAC investors should have the same protections as investors in traditional IPOs, citing the potential for “information asymmetries, conflicts, and fraud.”In a speech, Gensler outlined possible op...

By Matthew Heller • Dec. 9, 2021

American Renal Execs Charged With Manipulating Revenue

American Renal Associates and three of its former finance executives have been charged with engaging in a multimillion-dollar revenue recognition fraud to boost its financial performance.The U.S. Securities and Exchange Commission filed a civil complaint on Monday against ARA, a provider of dialy...

By Matthew Heller • Dec. 7, 2021

SEC Finalizes Rules on Chinese Issuers

The U.S. Securities and Exchange Commission has finalized the rules it will use to implement a law that allows it to delist Chinese stocks.Under the Holding Foreign Companies Accountable Act (HFCAA), the SEC can ban companies from trading and delist them from exchanges if the Public Company Accou...

By Matthew Heller • Dec. 3, 2021

Pharma CFO Charged With Insider Trading

Former Immunomedics CFO Usama Malik and his ex-girlfriend have been charged with using inside information he had obtained about one of the pharmaceutical firm’s drugs to trade in its shares.According to the U.S. Securities and Exchange Commission, Malik was living with Lauren Wood, Immunomedics’ ...

By Matthew Heller • Dec. 3, 2021

How to Make a Good Impression in Bankruptcy Court

How should a chapter 11 debtor’s financial information be presented to the bankruptcy court to create the best first impression? To give the court an accurate picture of the results of operations during Chapter 11 and for the debtor to get sufficient time in bankruptcy to achieve its goals?The pa...

By Kenneth A. Rosen • Dec. 1, 2021

Musk Warns SpaceX Employees of Bankruptcy Risk

SpaceX founder Elon Musk told employees the space company faces a “genuine risk of bankruptcy” if its biggest reusable rocket Starship cannot meet a flight rate of at least once every two weeks next year, Space Explored reported on Tuesday, citing an internal email.An upset Musk told employees in...

By Vincent Ryan • Dec. 1, 2021

SEC Tightens Guidance on ‘Spring-Loaded’ Options

The U.S. Securities and Exchange Commission updated accounting guidance on Monday to help public companies determine the correct valuation of stock options awarded to executives ahead of the release of market-moving information.According to the SEC’s Office of the Chief Accountant and the Divisio...

By Matthew Heller • Nov. 29, 2021

Banking Regulators Planning Crypto Guidance

U.S. banking regulators are planning a joint effort next year to craft guidance for banks on what kind of crypto-asset services they can provide.In a joint statement, the Federal Reserve, Federal Deposit Insurance Corp., and Office of the Comptroller of the Currency (OCC) said Tuesday that after ...

By Matthew Heller • Nov. 24, 2021

Ex-ProPetro CEO Fined Over Undisclosed Perks

Texas oilfield services firm ProPetro and former CEO Dale Redman have settled charges that they understated his executive perks by failing to disclose ProPetro had reimbursed him for more than $400,000 in personal and travel expenses.According to the U.S. Securities and Exchange Commission, ProPe...

By Matthew Heller • Nov. 23, 2021

Who’s Blowing the Whistle?

Fiscal-year 2021 was a record year for whistleblower awards, the SEC’s Office of the Whistleblower (OWB) revealed in its annual report. The Securities and Exchange Commission awarded a total of $564 million to 108 whistleblowers. That one-year total was higher than all of the prior years of the p...

By Vincent Ryan • Nov. 22, 2021

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