Actions against Respondent, an operator of a digital-currency trading platform, for alleged registration failures. According to the SEC and CFTC, Respondent solicited and accepted futures orders from customers, accepted Bitcoin as collateral margin for customers’ trades, and sold security-based swaps without registering with either agency. Respondent has agreed to pay a civil penalty of $100,000 to the CFTC. Respondent has agreed to pay disgorgement and prejudgment interest of $131,952 and a civil monetary penalty of
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Blog Posts Tagged With Corporate and Other Issues
Subscribe to Corporate and Other Issues RSS FeedIn re Upstream Energy Services LLC (A.P. Oct. 24, 2019, Settled)
Action against Respondent, an energy company, for alleged registration failure. According to the CFTC, Respondent accepted orders from two clients, traded natural gas commodity futures and options based on those orders, and received fees for those orders without registering with the CFTC as a futures commission merchant. Respondent has agreed to pay a civil penalty of $75,000.
In re UQM Technologies, Inc. (A.P. Oct. 11, 2019, Settled)
Action against Respondent, an automotive parts manufacturer, for alleged financial misstatement. According to the SEC, Respondent made misleading statements regarding the value and certainty of a supply agreement with a potential customer. Respondent has agreed to pay a civil penalty of $500,000.
SEC v. Telegram Group Inc. and TON Issuer Inc. (S.D.N.Y. Oct. 11, 2019, Contested)
Action against Defendants, a mobile messaging company and a blockchain company, for an alleged unregistered offering of digital tokens. According to the SEC, the tokens are securities because investors expected to profit from Defendants’ work. The Court has issued a temporary restraining order.
In re Northwest Biotherapeutics, Inc. (A.P. Oct. 10, 2019, Settled)
Action against Respondent, a biotechnology company, for alleged deficiencies in Internal Control over Financial Reporting (ICFR). According to the SEC, Respondent disclosed ICFR as a material weakness in public filings but failed to take adequate steps to remedy disclosed weaknesses. Respondent has agreed to pay a civil penalty of $250,000.
In re Nebulous, Inc. (A.P. Sept. 30, 2019, Settled)
Action against Respondent, a cloud services company, for an alleged unregistered offering. The SEC alleges that Respondent issued and publicly sold convertible electronic notes without registering or securing an exemption from registration. Respondent has agreed to pay disgorgement of $120,000, prejudgment interest of $24,601.85, and a civil penalty of $80,000.
SEC v. Christopher J. Spencer and John Busshaus (S.D.N.Y. Sept. 30, 2019, Settled)
Action against Defendants, a CEO and CFO of a digital media download kiosk company, for alleged fraud. According to the SEC, Defendants misrepresented the functionality, profitability, and number of installations of the company’s kiosks in press releases, public filings, and earnings calls. Defendants have agreed to pay disgorgement, prejudgment interest, and civil penalties to be determined by the court.
In re CHS, Inc. (A.P. Sept. 30, 2019, Settled)
Action against Respondent, an agribusiness cooperative, for alleged deficiencies in Form 204 reports. Respondent has agreed to pay a civil penalty of $500,000.
SEC v. Mylan N.V. (D.D.C. Sept. 27, 2019, Settled)
Action against Defendant, a pharmaceutical company, for alleged failure to disclose a risk of loss resulting from a Department of Justice investigation. Defendant has agreed to pay a civil penalty of $30,000,000.
In re FCA US, LLC, and Fiat Chrysler Automobiles, N.V. (A.P., Sept. 27, 2019, Settled)
Action against Respondents, two car companies, for alleged misstatements in annual reporting. The SEC alleges that Respondents falsely reported the number of cars sold and how those sales compared to different quarters. Respondents agreed to pay a civil penalty of $40,000,000.
In re iQuantifi, Inc., and Thomas F. White (A.P. Sept. 27, 2019, Settled)
Action against Respondents, a financial technology company and its principal, for an alleged unregistered offering. The SEC alleges that Respondents improperly sold shares of the company to non-accredited investors without registering. Respondent has agreed to pay a civil penalty of $25,000.
In re Herbalife Nutrition Ltd. (A.P., Sept. 27, 2019, Settled)
Action against Respondent, a multi-level marketing firm, for alleged misleading disclosures. According to the SEC, Respondent mischaracterized its China business model as direct sales, when in fact it resembled multi-level marketing, the latter of which is impermissible in China. Respondent has agreed to pay a civil penalty of $20,000,000.
In re Westport Fuel Systems, Inc. and Nancy Gougarty (A.P., Sept. 27, 2019, Settled)
Action against Respondents, a publicly traded clean fuel systems company and its former chief executive, for alleged violations of the anti-bribery, books and records, and internal controls provisions of the FCPA. The SEC alleges that Respondents orchestrated a stock transfer to a Chinese official in an effort to increase the dividend of a Chinese joint venture in which the corporate Respondent held shares. Respondent company agreed to pay disgorgement of $2,350,000, prejudgment interest of $196,000,
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SEC v. Michael Ajzenman and Cutting Edge Business Services, Inc. (E.D.N.Y., Sept. 26, 2019, Settled)
Action against Defendants, a consulting company and its owner, for an alleged unregistered offering and alleged fraud. According to the SEC, Defendant owner negotiated the purchase of purported convertible notes fraudulently issued by Defendant company and then profited by selling securities through an unregistered transaction. Defendants have agreed to pay, jointly and severally, disgorgement of $233,336.90. Defendant owner has agreed to pay a civil penalty of $7,500. Defendant company has agreed to pay a civil
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In re PPG Industries, Inc. (A.P. Sept. 26, 2019, Settled)
Action against Respondent, a materials company, for alleged misstatements in financial reporting. The SEC alleges that Respondent disregarded internal accounting standards and inflated income to meet earnings projections. The SEC has declined to impose a civil penalty on Respondent based on its cooperation and remediation.
SEC v. Efuel EFN Corp., et al. (M.D. Fla., Sept. 24, 2019, Contested)
Action against Defendants, a mining company and its executives, for alleged financial misstatement. The SEC alleges that Defendants inflated the value of deposits in leased mines with an option to purchase while also claiming they owned those mines.
In re Comscore, Inc. (A.P. Sept. 24, 2019, Settled); In re Serge Matta (A.P. Sept. 24, 2019, Settled)
Action against Respondents, a publicly traded data services company and its former chief executive, for alleged misstatements in annual reporting. The SEC alleges Respondents overvalued non-monetary data trades and monetary transactions, and misled the company’s internal auditors in public filings. Respondent company has agreed to pay a civil penalty of $5,000,000. Respondent former executive has agreed to a 10-year officer and director bar and to pay a civil penalty of $700,000.
SEC v. Carlos Ghosn and Gregory Kelly (S.D.N.Y., Sept. 23, 2019, Settled); In re Nissan Motor Co., Ltd. (A.P. Sept. 23, 2019, Settled)
Action against Respondent, a car company, and Defendants, two of the company’s former executives and board members, for alleged fraud relating to executive compensation. According to the SEC, Defendants and Respondent publicly reported lower executive compensation levels than were actually paid. One Defendant has agreed to a $1,000,000 civil penalty, 10-year officer and director bar, and five-year bar against appearing as an attorney before the SEC. The other Defendant has agreed to a $100,000 civil
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In re Bancorp, Inc. (A.P. Sept. 20, 2019, Settled); In re James David Hilty (A.P. Sept. 20, 2019, Settled); In re Donald F. McGraw, Jr. (A.P. Sept. 20, 2019, Settled)
Actions against Respondents, a bank holding company and two executives, for alleged misstatements in public filings. The SEC alleges Respondents failed to properly classify, report, and maintain adequate internal controls over certain troubled assets, which led to underreporting of losses in public filings. Respondent bank has agreed to pay a civil penalty of $1,400,000. Respondent executives have agreed to pay civil penalties of $50,000 each.
SEC v. Tom Simeo (S.D.N.Y. Sept. 17, 2019, Contested)
Action against Defendant, a former energy-company executive, for alleged misstatements in public filings. According to the SEC, Defendant claimed in public filings that the energy company had a CFO when in fact it did not.
In re Marvell Technology Group (A.P. Sept. 16, 2019, Settled)
Action against Respondent, a semiconductor company, for alleged misstatements in financial reporting. The SEC alleges that Respondent improperly pulled forward future orders to current quarters in order to meet earnings projections. Respondent has agreed to pay a civil penalty of $5,500,000.
In re Daniel Khesin (A.P. Sept. 5, 2019, Settled); In re Abner Silva (A.P. Sept. 6, 2019 Settled)
Actions against Respondents, two former executives of a hair and personal care products company, for alleged misstatements in financial reporting. According to the SEC, Respondents overstated the company’s revenues by recording revenue for products that were not sold, overbilling customers and then later crediting their accounts, and shipping products without expecting payment. Respondents have agreed to pay respective civil penalties of $130,000 and $80,000.
In re Omega Protein Corporation (A.P. Aug. 29, 2019, Settled)
Action against Respondent, a manufacturer of fish oil and fish meal products, for allegedly misrepresenting in its annual and quarterly reports that it was in compliance with all the covenants related to loan agreements with the federal government. According to the SEC, Respondent had violated its covenants, a default that required payment of accelerated interest under its outstanding loan agreements. Respondent has agreed to pay a civil penalty of $400,000.
In re Juniper Networks, Inc. (A.P. Aug. 29, 2019, Settled)
Action against Respondent, a networking equipment product and service company, for alleged violations of the books and records and internal controls provisions of the FCPA. According to the SEC, sales employees of Respondent’s foreign subsidiaries agreed with third-party channel partners to increase the incremental discount provided to customers through those partners without passing the discounts on to customers. The SEC alleges that the channel partners diverted the discounts for personal and marketing expenses, including trips
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