Regulatory Enforcement Defense

  • Representing a global bank senior executive in SEC investigation of supervision.
  • Representing the President and CEO, and separate Finance Executive, of a private company in SEC investigation regarding sales of private placement securities to international investors.
  • Representing a broker-dealer and registered representative in FINRA investigation of Outside Business Activities related to purchases of private placement securities.
  • Representing a broker-dealer in FINRA investigation concerning Large Options Position Reporting (LOPR).
  • Represented leading national securities exchange in investigation by the SEC Division of Enforcement related to exchange order type functionality, which concluded with a formal closing letter from the Division.
  • Representing an investment services company regarding the Municipalities Continuing Disclosure Cooperation Initiative (MCDC).
  • Serving as defense counsel for a Swiss bank in connection with the Department of Justice Program for Non-Prosecution Agreements or Non-Target Letters for Swiss Banks.
  • Representing an individual criminally charged with insider trading.
  • Representing a broker-dealer owner in FINRA investigation into overseas trading and related supervisory issues.
  • Representing a senior trader of global bank in SEC enforcement action alleging parking of securities.
  • Representing a global bank’s senior capital markets executive in FINRA enforcement action alleging failure to establish adequate supervisory procedures.
  • Representing a broker-dealer in FINRA investigation into potential information barrier violations.
  • Representing a private equity firm’s principal in a settled SEC enforcement matter alleging conflicts of interest and non-disclosure.
  • Representing a financial institution as lead counsel in trial of an SEC administrative proceeding.
  • Representing a major broker-dealer in a FINRA investigation related to mutual fund sales practices and customer suitability.

Looking Forward

Despite a 35-day government shutdown, a longstanding hiring freeze only recently lifted, and the challenge of policing new products and evolving trading patterns, the SEC saw a solid growth in its enforcement statistics. This vigor will unquestionably persist during 2020. As we look forward, things to watch closely include the following: The Supreme Court’s Liu case will likely resolve the question, first raised two years ago in Kokesh, of the SEC’s statutory authority to seek disgorgement in federal court. At the same time, Congress has mustered strong bipartisan support for legislation that would confirm the SECs disgorgement authority and extend the disgorgement statute of limitations from 5 to 14 years. Other pending legislation proposes to substantially increase the measure of SEC monetary penalties, including by adding a restitutionary penalty. The SEC has largely worked through its backlog of remanded administrative proceedings following the successful appointments clause challenge to its ALJs in Lucia, but its administrative adjudication system remains frozen, at least for litigated cases, by a new Constitutional challenge based on the removal clause. Finally, the SEC enforcement staff continues to struggle with the ill fit of the Howey test to digital assets, and cases during 2020 will present an opportunity to rationalize regulation of this new asset class.