U.S. regulators sought to overturn a 2012 court ruling that prohibited victims of Allen Stanford’s $7 billion Ponzi scheme from seeking compensation, in an unprecedented legal battle between the government and an industry-backed fund that protects investors. In oral arguments on Wednesday, a lawyer for the U.S. Securities and Exchange Commission urged the U.S. Court of Appeals for the District of Columbia to force the fund to start court proceedings so that victims can file claims to recover at least a portion of the millions of dollars they lost. More on Reuters [...]
|
||||
|
U.S. securities regulators are reviewing whether public companies overwhelm investors with “information overload” and should instead streamline disclosures about financial data, executive pay and dozens of other issues. Securities and Exchange Commission Chairwoman Mary Jo White did not reveal specific reforms in a speech on Tuesday, but said the SEC would release the results of a study into the federal rules governing corporate disclosures “very soon.” More on Reuters [...] Broker-dealers should better manage conflicts of interest at their firms by more closely monitoring broker compensation and reviewing new financial products, among other practices, according to findings published late Monday by Wall Street’s industry-funded watchdog. The report on conflicts of interest in the broker-dealer industry, conducted by the Financial Industry Regulatory Authority, follows from a process that began last year when FINRA said it would begin requesting information from 14 firms. The regulatory authority launched the review out of concern that certain financial incentives, including commission-based compensation to brokers, could lead to promotions of products that may not be the best choice for investors. More on Reuters [...] For years federal law enforcers ignored warnings about R. Allen Stanford’s $7 billion fraud, but don’t expect government officials to suffer any penalty. Instead, plaintiffs lawyers are seeking to use Stanford’s crimes as a pretext to launch class-action lawsuits against other people and businesses. Now the Supreme Court will decide whether to let them. The question at oral argument this week in Chadbourne & Parke LLP v. Troice was whether state class-action lawsuits filed against various vendors to Stanford’s operation should be allowed to proceed. More in the Wall Street Journal [...] It has been nearly five years since the Ponzi scheme perpetrated by Bernard L. Madoff came to light, and litigation surrounding the case grinds on. The trustee seeking to recover funds for defrauded investors, Irving H. Picard, asked the Supreme Court to overturn a lower court decision barring him from pursuing banks for their role in helping perpetuate the fraud. More in the New York Times [...] Five former employees of Bernard L. Madoff on trial over allegations they aided in his $17 billion fraud probably scrapped plea talks involving harsh prison terms to gamble for total exoneration from a jury, ex-prosecutors said. The U.S. had little reason to offer the group leniency in exchange for testimony against others, since Madoff and his top aides had already pleaded guilty, said Philip Hilder, a former federal prosecutor in Houston who represents defendants accused of white-collar crimes. More on Bloomberg [...] The trustee liquidating Bernard Madoff’s former firm asked a federal appeals court to block a $410 million settlement between the state of New York and money manager J. Ezra Merkin. New York Attorney General Eric Schneiderman announced the settlement with Merkin, who controlled four funds that fed more than $2.4 billion of investor money into Madoff’s fraud, in June 2012. Trustee Irving Picard tried to block the deal, claiming it would hamper his efforts to collect assets for Madoff investors. In arguments before the appeals court in Manhattan today, David Sheehan, a lawyer for Picard, asked a three-judge panel to reverse lower court decisions permitting the settlement to go forward. More on Bloomberg [...] Q: Is it fair for the SEC to suspend trading in penny stocks? A: Stopping crimes before they happen might sound like it’s out of science fiction. But that’s been an increasing goal of the Securities and Exchange Commission. Rather than waiting for a swindler to take millions from investors, the SEC is trying to find scams in the making. And one of the most popular vehicles for scammers to separate people from their money are stocks that remain trading on marketplaces that don’t have a company associated with them. When 18,000 people got fleeced in R. Allen Stanford’s $7.2 billion Ponzi scheme, the court appointed a receiver in 2009 to recover as much money as possible from Stanford’s failed companies to return to investors. After 41/2 years, the receiver, Ralph Janvey, began mailing checks ranging from $2.81 to $110,000 to hundreds of investors. That amounts to about $55 million of the $6 billion lost in the scheme, less than a penny on the dollar. More in Dallas News [...] The trustee seeking to recover money for the victims of Bernard L. Madoff’s Ponzi scheme asked the Supreme Court on Wednesday to review a ruling that prohibits him from suing several of the world’s largest banks that he contends aided the fraud. In June, a federal appeals court in Manhattan decided that the trustee, Irving H. Picard, did not have standing to sue JPMorgan Chase, UBS, HSBC and UniCredit Bank Austria on claims that they abetted the multibillion-dollar fraud, which lasted decades. That opinion upheld a lower-court ruling by Judge Jed S. Rakoff of Federal District Court in Manhattan. On Wednesday, lawyers for Mr. Picard filed a petition to the Supreme Court requesting that it hear an appeal of the case. More in the New York Times [...] |
||||
|
Contact us by phone at (631) 425-0770, fax at (631) 421-5701 or by email at admin@investoraction.org
|
||||