Securities Law

Visited By FBI in Big Insider-Trading Probe, Researcher Explains ‘Why I Chose Not to Wear a Wire’

As federal authorities step up the pace in a three-year-old insider-trading investigation of the financial industry that reportedly could be record-breaking in scope, a Portland, Ore., independent research analyst has been making headlines by going public with his refusal to wear a wire when approached by FBI agents. John Kinnucan…

Nov 29, 2010 9:42 PM CST

Judge OKs Rajaratnam Wiretaps in Galleon Insider-Trading Case

In a groundbreaking $20 million insider-trading case based on wiretaps, a federal judge has ruled that thousands of hours of secretly recorded telephone conversations may be used as evidence by federal prosecutors in a case against Raj Rajaratnam, the founder of Galleon Group. Although the defense argued that the Securities…

Nov 24, 2010 8:50 PM CST

Feds Start Raids in Massive 3-Year Insider-Trading Probe of Financial Industry

Following news over the weekend from the Wall Street Journal that an insider-trading probe of unprecedented scope is underway in the financial industry comes word today from the newspaper that the FBI has apparently gotten the ball rolling on enforcement by raiding the offices of three hedge funds in Boston…

Nov 22, 2010 10:27 PM CST

2 Workers Arrested in $65B Madoff Swindle, Accused of Faking Records, Paying Selves & Firm Friends

Two former longtime back office workers for Bernard Madoff have been arrested following federal indictments concerning their alleged roles in a record-breaking investment swindle of up to $65 billion. Annette Bongiorno, 62, and Joann Crupi, 49, also face a civil case brought by the Securities and Exchange Commission for allegedly…

Nov 18, 2010 9:29 PM CST

Former N.Y. Associate Disbarred After Fraud Conviction

A former Ropes & Gray associate was disbarred yesterday after he previously pleaded guilty to securities fraud in a case that stemmed from a wide-ranging insider-trading matter. Brien Santarlas admitted last year to selling information about deals his ex-firm was working on, in exchange for more than $30,000 in kickbacks,…

Nov 17, 2010 10:23 PM CST

Fed’l Judge Blasts ‘Mean-Spirited’ Gov’t Memo Implying Bias for Wealthy Defendant

As he gave a high-profile defendant in an options-backdating case the probation and home confinement recommended in a presentence investigation, a federal judge in Los Angeles yesterday also offered a blistering critique of a prosecution memo urging him to send ex-KB Home CEO Bruce Karatz to the slammer. The sentencing…

Nov 11, 2010 9:29 PM CST

Book Sets Bizarre BofA Scene: GC Fired Over Pay Fuss; Lawyer Tells New Boss, You’re My 3rd GC Today

Some think of top in-house lawyers as masters of the universe, but a new book may help disabuse them of that notion. Written by Financial Times correspondent Greg Farrell, it contends that a former Bank of America Corp. general counsel, Tim Mayopoulos, was fired because he carped that those in…

Nov 5, 2010 6:59 PM CDT

Banks Draw Scrutiny From Feds and Chicago-Area Sheriff

A sheriff in Chicago says he’ll halt evictions by three lenders until they submit affidavits confirming that the paperwork was done properly. Cook County Sheriff Tom Dart said his foreclosure moratorium applies to Bank of America, J.P Morgan Chase and GMAC/Ally Financial, according to the Associated Press, Bloomberg and the…

Oct 20, 2010 4:05 PM CDT

SEC Proposed Rule Would Allow Nonbinding Shareholder Vote on CEO Pay

The U.S. Securities and Exchange Commission moved this week to enact a provision that would give investors a voice in CEO pay at U.S. corporations. Shareholders would get to vote on salaries and bonuses, though the vote would be nonbinding, Bloomberg reported. A company’s board of directors would always have…

Oct 20, 2010 12:24 AM CDT

Appeals Court Affirms Stiff $95K Sanction Against Lawyer, Client

A federal appeals court has affirmed a nearly $95,000 sanction against a New York lawyer and his client for knowingly filing a time-barred securities fraud suit. The 2nd U.S. Circuit Court of Appeals last week issued a summary order upholding the sanction imposed by U.S. District Judge Denis R. Hurley…

Oct 15, 2010 7:59 PM CDT

$156K Fee Award in $245M Case ‘On the Stingy Side’ But Upheld By 2nd Circuit

A $245 million federal securities class action settlement never would have been achieved but for its work in bringing the initial federal cases on which it was based, a Pennsylvania law firm contends. Even if that’s true, however, Chimicles & Tikellis is stuck with an attorney’s fee award of just…

Oct 15, 2010 10:00 AM CDT

Lawyer Introductions Led to $550K Fine for Manatt Phelps in NY Pension Fund Case

Updated: A California law firm has agreed to pay $550,000 to the state of New York and refrain from appearing before public pension funds there for the next five years, after several unidentified partners introduced, or tried to introduce, financial firms seeking money to several of the institutional investors. Although…

Oct 12, 2010 8:22 PM CDT

Ex-Attorney Rothstein’s Right-Hand Woman Gets 10 Years in $1.4B Ponzi Scheme

Exceeding the prosecution’s recommendation of a seven-year sentence, a federal judge in South Florida today imposed a 10-year prison term on an aide to ex-attorney Scott Rothstein for her role in his approximately $1.2 billion Ponzi scheme, in which he sold expected income from fake legal settlements. Debra Villegas, 43,…

Oct 8, 2010 5:24 PM CDT

US Claims Facebook, Twitter Used in Pump-and-Dump Stock Scheme

Prosecutors say they discovered a multimillion dollar “pump and dump” scheme that used social media to tout stocks during an investigation of suspected cocaine trafficking by longshoremen. The Manhattan U.S. Attorney’s office claims the defendant used websites, Facebook and Twitter to spur investors to buy penny stocks, Reuters reports. One…

Oct 6, 2010 11:27 AM CDT

Court’s Sentence Makes Rogue Trader Kerviel a Six-Billion-Dollar Man

Jerome Kerviel was sentenced to what is locally considered a hefty three-year prison term today by the main criminal court in Paris, and ordered to repay his employer, Societe General, nearly $7 billion in a record-breaking rogue trading case at the bank. Although the 33-year-old defendant and some observers blamed…

Oct 5, 2010 11:41 PM CDT