Securities Law

Nadel Receiver Sues Holland & Knight, Alleges Failure to Root Out Fraud

Holland & Knight is facing a malpractice suit filed on behalf of the court-appointed receiver trying to recover assets for investors who lost money to alleged Ponzi schemer Arthur Nadel. Receiver Burton Wiand received court approval to sue the law firm last month, the Sarasota Herald-Tribune reports. The suit (PDF),…

Sep 1, 2009 7:38 PM CDT

Judge Tosses Refco Trustee’s Suit Against Mayer Brown

A federal judge has dismissed a lawsuit by a bankruptcy trustee against Mayer Brown and two accounting firms stemming from the collapse of the brokerage firm Refco. U.S. District Judge Gerard Lynch said the pleadings by trustee Marc Kirschner failed to allege enough facts showing the defendants actually knew of…

Aug 27, 2009 11:37 AM CDT

Judge in Merrill Bonus Case Asks: Should Lawyers Be Responsible?

The federal judge who wanted to know more about why shareholders weren’t told of a plan to pay bonuses to Merrill Lynch executives isn’t satisfied with the answers. On Tuesday, U.S. District Judge Jed Rakoff asked the Securities and Exchange Commission for a better explanation why executives, and possibly lawyers,…

Aug 26, 2009 1:55 PM CDT

SEC Blames Wachtell, Shearman for Keeping Bank Bonuses Secret

The Securities and Exchange Commission is blaming two law firms for Bank of America’s failure to disclose $3.6 billion in executive bonuses it planned to pay to executives at Merrill Lynch. An SEC brief points the finger at lawyers from Wachtell, Lipton, Rosen & Katz and Shearman & Sterling, according…

Aug 25, 2009 1:45 PM CDT

DOJ Won’t Appeal Ruling Likely to Cut Sentence for Nacchio

The Department of Justice won’t appeal a ruling last month expected to result in a lower insider trading sentence for the former CEO of Qwest Communications. Justice Department spokeswoman Laura Sweeney said on Monday that the ruling would not be appealed, but she did not indicate the reason why, Reuters…

Aug 18, 2009 6:39 PM CDT

9th Circuit Tosses Conviction of Brocade Ex-CEO, Cites Prosecutor Misconduct

A federal appeals court has overturned the backdating conviction of the former CEO of Brocade Communications, saying the trial of Gregory Reyes was tainted by a prosecutor’s untrue statement to the jury. The San Francisco-based 9th U.S. Circuit Court of Appeals ruled today, tossing Reyes’ 21-month sentence for backdating stock…

Aug 18, 2009 6:16 PM CDT

$65B Madoff Ponzi Scheme May Have Begun As Early as 1984

A gigantic Ponzi scheme orchestrated by Bernard Madoff under the guise of a hedge fund could have gotten its start as early as 1984, reports Newsday. According to in-court testimony Tuesday by right-hand-man Frank DiPascali Jr. as he pleaded guilty to his role in the scheme and a civil filing…

Aug 13, 2009 11:54 PM CDT

Judge Slashes $45M from Coughlin Stoia Fees Because of Disgraced Partner

A federal judge in Minneapolis has slashed $45 million from attorney fees due to Coughlin Stoia Geller Rudman & Robbins because of its disgraced former partner William Lerach. Ruling in a backdating settlement against UnitedHealth, U.S. District Judge James Rosenbaum said Lerach failed to inform the court he was under…

Aug 12, 2009 2:59 PM CDT

Madoff Aide Pleads Guilty, Says ‘It Was All Fake,’ Judge Nixes $2.5M Bond Deal

After Frank DiPascali pleaded guilty today to carrying out one of the biggest frauds on Wall Street with the help of unidentified “other people” who put together its fictitious books and investment statements, the plan was for the cooperating witness and longtime aide to convicted $65 billion Ponzi schemer Bernard…

Aug 11, 2009 10:21 PM CDT

Fed’l Judge Balks Again, Further Delays Ruling on SEC’s $33M Pact With BofA

A proposed $33 million settlement by the U.S. Securities and Exchange Commission to resolve allegations that the Bank of America didn’t disclose to investors that it was to pay $3 billion in executive bonuses when acquiring Merrill Lynch & Co. “might be approvable,” a federal judge said at a hearing…

Aug 10, 2009 11:22 PM CDT

Williams & Connolly Hires Ex-GC Who Paid $6.5M in Insider Trading Probe

The former general counsel of investment bank UBS AG has rejoined Williams & Connolly, despite something of a blemish on his record—an agreement to pay $6.5 million to resolve an insider trading probe. David Aufhauser, who is also a former general counsel of the U.S. Treasury, joined the Washington, D.C.,…

Aug 10, 2009 12:04 PM CDT

Judge Asks Whether Taxpayers Would Fund $33M BofA Settlement with SEC

A federal judge has refused to approve an agreement by Bank of America to pay $33 million to settle allegations by the Securities and Exchange Commission that the bank misled investors about plans to pay bonuses to executives of Merrill Lynch. Judge Jed Rakoff set a Monday hearing to examine…

Aug 7, 2009 12:43 PM CDT

Ex-AIG Chief Issues ‘Defiant Statement’ After Settling with SEC for $15M

Maurice “Hank” Greenberg, the former CEO of the American International Group, has agreed to pay $15 million to settle a complaint by the Securities and Exchange Commission accusing him of overseeing an accounting fraud at the insurer. The amount is one of the largest settlements against an individual in a…

Aug 7, 2009 12:08 PM CDT

SEC Enforcement Chief Wants to Use Deferred Prosecution Agreements

The Securities and Exchange Commission hopes to take a cue from the Justice Department by entering into deferred prosecution agreements to resolve cases. The idea is to reward extraordinary cooperation, SEC enforcement director Robert Khuzami said in a speech Wednesday to the New York City Bar Association. The Wall Street…

Aug 6, 2009 4:51 PM CDT

Condo Hotel Buyers File Suits Claiming Securities Law Violations

Buyers of condo hotels are going to court in an effort to get their money back, arguing that the sellers violated securities laws. The units have turned out to be bad investments for many buyers, the Wall Street Journal (sub. req.) reports. The condos have lost much of their value…

Aug 5, 2009 11:29 AM CDT