It's hornbook law that a later intentional breach of contract, alone, doesn't equal promissory fraud.
Holding it therefore cannot establish mail or wire fraud, the Second Circuit reversed the Government's $1.2 Billion FIRREA judgment against Countrywide, Bank of America and others, with instructions to dismiss the case. The case started as a qui tam action alleging that Countrywide's "high-speed swim lane" process delivered substandard mortgage loans to GSEs (Fannie, Freddie) during performance of master mortgage-loan sales agreements ("MLSAs") executed earlier. The ...
Starting June 23, municipal advisors will be subject to revised Rule 42 and its heightened engagement letter and disclosure obligations. SIFMA has released exposure drafts of compliance documents to help MAs meet those requirements. The drafts include a model engagement letter, disclosure statements for both new and continuing engagements and a client -intake checklist. They are here. Broadly speaking, the amended Rule imposes upon municipal advisors
- A fiduciary duty of care and loyalty to municipal entity clients - but only a duty of care to obligated persons (like conduit ...
Affirming dismissal of some lingering Morgan Keegan bond fund actions, the Sixth Circuit joined the Second in holding that American Pipe class-action tolling does not affect the expiration of a statute of repose. The Court reasoned that, whether equitable or procedural, American Pipe cannot supersede the substantive extinction of a legal right by repose. The Tenth Circuit has held that American Pipe tolls statutes of repose pending class certification. Joseph v. Wiles, 223 F. 3d 1155 (10th Cir. 2000). The Second Circuit said not. Police & Fire Ret. Sys. Of City of Detroit v. IndyMac ...
The Supreme Court held May 16 that the exclusive federal jurisdiction provision of the 1934 Securities Exchange Act means the same as the "arising under" test for federal-question jurisdiction and does not pre-empt state law claims unless they require proving a violation of a rule or regulation under the Act.
Manning and other shareholder plaintiffs filed suit against Merrill Lynch and others in New Jersey state court alleging naked short selling in violation of SEC Regulation SHO (which requires a "good locate" at the time of a short trade to prevent naked shorting). But ...
Since the 2010 passage of the Dodd-Frank Act, the U.S. Securities and Exchange Commission ("SEC") has been the subject of growing criticism regarding its increased use of administrative proceedings.
By enacting Dodd-Frank, Congress vastly expanded the enforcement powers afforded to the SEC by allowing it to address potential violations, such as insider trading, in its internal administrative courts rather than in federal court. While the SEC attributes its increased use of administrative proceedings to the significant benefits the administrative proceedings provide ...
The MSRB's amended Rule G-42 becomes effective June 23, prescribing new conduct standards for municipal advisors and for the underwriters working with them. In advance of the effective date, the MSRB has published interpretive guidance on the new Rule:
For MAs, here. For Underwriters, here. On-demand webinar, here.
Broadly speaking, the amended Rule imposes upon municipal advisors- A fiduciary duty of care and loyalty to municipal entity clients - but only a duty of care to obligated persons (like conduit borrowers);
- A written engagement-letter and conflict-disclosure regime;
The Securities Division of the Tennessee Department of Commerce and Insurance issued a May 2 press release encouraging consumers to report financial-services misconduct to its Financial Services Investigations Unit.
"The FSIU investigates complaints involving allegations of securities and insurance fraud and other violations of the Tennessee Securities and Insurance Acts," said TDCI Assistant Commissioner for Securities Frank Borger-Gilligan. "Common violations include: fraud, misappropriation of funds, misrepresentations, unregistered or unlicensed ...
Richard Ketchum, the retiring CEO of FINRA, said that the regulator intends to expand the reporting available through its BrokerCheck ® web tool to include relative concentrations of disciplined brokers in industry firms.
Some studies have found that brokers terminated for misconduct often are hired by firms having a higher incidence of their own misconduct. "There are firms that hire from the predatory firms that go out of business. That is your biggest risk," said Ketchum. Ketchum also said that FINRA is considering making its underlying BrokerCheck data available for bulk ...
On April 29, the United States Court of Appeals entered an amended order (previously decided on March 17, 2016) that affirmed the decision of the United States District Court for the Southern District of New York in DeKalb County Pension Fund v. Transocean Ltd., Robert L. Long, Jon A. Marshall, and Transocean Inc.
The central issues in the case were (i) what statute of repose applies to a § 14(a) claim under the Securities Exchange Act of 1934? and (ii) when does the statute of repose began to run? This was a particularly thorny question because the private right of action in § 14(a) is ...