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August 30, 2024
FINRA Dings Raymond James $2M Over Customer Complaints
Two Raymond James units will pay nearly $2 million to settle allegations from the Financial Industry Regulatory Authority that they didn't properly handle customer complaints or supervise mutual fund purchases.
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August 30, 2024
Conn. Mayor Says Scam Cost Town $208K, Finance Chief Out
The mayor of a Connecticut town has announced that it was the victim of a "social engineering scam" that cost it about $208,000, leading to the resignation of the town's finance director, although it has since recouped half the stolen funds.
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August 30, 2024
UK Litigation Roundup: Here's What You Missed In London
This past week in London has seen television property developer Kambiz Babaee hit with a fraud claim, a Bitcoin podcaster reignite a dispute with Australian computer scientist Craig Wright and football club owner Massimo Cellino's company file a claim against ClearBank. Here, Law360 looks at these and other new claims in the U.K.
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August 30, 2024
FTX Exec Drops Bid To Undo Plea Amid Partner's Indictment
Former FTX executive Ryan Salame is no longer seeking to vacate his guilty plea that he says Manhattan federal prosecutors induced with a false promise to halt a campaign finance probe into his partner Michelle Bond, though his claims that they broke their word will still be litigated before two different judges.
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August 30, 2024
Firm Accused Of Botching Arbitration In Tribal Lending Row
Bradley Arant Boult Cummings LLP and one of its former attorneys have been hit with a California federal court suit accusing them of negligence in their representation of a consulting business and its president in a 2018 arbitration they say caused them at least $17.5 million in damages.
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August 29, 2024
PNC Asks 4th Circ. To Reconsider HELOC 'Offset' Ban Ruling
PNC Bank has asked the Fourth Circuit to take another look at its ruling that extended the "offset" provision of the Truth in Lending Act, which prevents banks from using funds held in deposit accounts to offset credit card debt without the consumer's consent, to home equity lines of credit.
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August 29, 2024
Texas' Anti-ESG Law Is Unconstitutional, Green Biz Org Says
A sustainability-focused business group on Thursday sued Texas state officials in federal court seeking to block a law that restricts state investments with financial firms and businesses that want to reduce their reliance on fossil fuels.
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August 29, 2024
Show Your Work, 5th Circ. Tells Judge In Banks' Subpoena Fight
The Fifth Circuit has vacated a Texas federal court decision denying a businessman's bid to quash a subpoena requested by two financial institutions looking for evidence in a Mexican fraud case, sending the case back to the lower court to explain its reasoning for the denial.
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August 29, 2024
Schwab's 'Cash Sweep' Paid For TD Ameritrade Buy, Suit Says
The Charles Schwab Corp. has been hit with a proposed class action in California federal court by three customers alleging that the investment bank obtains "outsized benefits" from its cash sweep programs and used a significant amount of the cash to finance its $26 billion acquisition of TD Ameritrade Holding Corp. several years ago.
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August 29, 2024
CFPB Fines NewDay $2.25M Over VA Home Loan Practices
The Consumer Financial Protection Bureau levied a $2.25 million fine against NewDay Financial LLC on Thursday for allegedly deceiving active-duty service members and veterans seeking cash-out refinance loans on their home mortgages.
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August 29, 2024
CFPB Notches Default Win Against Ga. Auto Loan Servicer
The Consumer Financial Protection Bureau has scored a default judgment against a Georgia-based auto loan servicer accused of a slew of unlawful business practices, including using kill switches to shut off borrowers' cars and double charging them for insurance premiums.
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August 29, 2024
Class Attys Seek Chancery Doc Sanctions In Santander Suit
An attorney for Santander Consumer USA Holdings Inc. stockholders urged a Delaware vice chancellor Thursday to exercise the court's "common law" document retention enforcer role during arguments for sanctions against the big auto lender's board, controller and parent for deleting messages before a $2.5 billion minority squeeze-out merger.
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August 29, 2024
4th Circ. Won't Revive Whistleblower's Credit Suisse Tax Suit
The Fourth Circuit upheld the dismissal of a former Credit Suisse employee's whistleblower case that alleged the Swiss bank continued to help clients evade taxes after it made a related plea deal with the U.S., saying a 2023 U.S. Supreme Court decision on the False Claims Act could not save the case.
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August 29, 2024
Convicted Drexel Prof Says Records Would've Swayed Jury
A Drexel University accounting professor convicted on charges of tax evasion and filing false tax returns after the government accused him of failing to report $3.3 million in income from a Trenton pharmacy has asked a New Jersey federal judge for a new trial.
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August 29, 2024
Backpage Co-Founder Gets 5 Years In Prostitution Case
The co-founder of defunct classifieds service Backpage.com was sentenced in Phoenix federal court to five years behind bars after he was convicted for his role in a $500 million prostitution scheme, the U.S. Department of Justice said Wednesday.
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August 29, 2024
Aon Unit Accuses Chinese Bank Of $2.8B Reinsurance Fraud
An Aon PLC subsidiary has accused one of China's largest banks in New York state court of helping a now-bankrupt insurtech company engage in a multibillion-dollar scheme to defraud the subsidiary and cedent insurers in reinsurance transactions, seeking to recover at least $140 million in lost premiums from the bank.
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August 29, 2024
JPMorgan Says Ex-Adviser Poached Clients Worth $13M
JPMorgan Chase has accused a former adviser of attempting to solicit clients for Wells Fargo, an effort JPMorgan alleged has so far been successful in converting 16 clients worth $13 million to its competitor.
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August 28, 2024
Calif. Assembly OKs 1st-Of-Its-Kind AI Safety Bill
California lawmakers on Wednesday approved a groundbreaking proposal that would set safety and security standards for large artificial intelligence models.
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August 28, 2024
Telegram CEO Indicted In France Over Crimes On Platform
Paris prosecutors on Wednesday unveiled wide-ranging criminal charges against Pavel Durov, the founder and CEO of encrypted messaging-platform Telegram, accusing him of aiding illegal child-pornography, fraud and other crimes and obstructing investigations, and barring him from leaving the country.
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August 28, 2024
Raymond James Hit With Suit Over 'Cash Sweep' Programs
Financial services giant Raymond James faces a proposed class action in Florida federal court alleging its so-called cash sweep programs offer interest rates "significantly lower" than those offered by competitors, in violation of federal law.
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August 28, 2024
BofA Units Fined $3M Over Trade Surveillance Compliance
Two Bank of America units have agreed to pay $3 million to settle the Financial Industry Regulatory Authority's claims that they did not sufficiently safeguard against potentially manipulative trading by customers.
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August 28, 2024
Capital One Says Merger's Pending Approval Tanks Challenge
Capital One urged a Virginia federal judge to toss or pause a lawsuit challenging the bank's proposed $35 billion acquisition of Discover Financial Services, saying the suit's claims are too speculative and contingent on unknown future events since they depend entirely on the acquisition receiving regulatory and government approval.
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August 28, 2024
NJ Law Firm Sues TD Bank Over Bounced $149K Check
A New Jersey personal injury firm has sued TD Bank, alleging that it lost over $146,000 as a result of its bank's failure to give it timely notice about a bad six-figure cashier's check deposited to the firm's business account.
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August 28, 2024
SEC To Embattled NC Insurance Exec: Show Us The Money
The U.S. Securities and Exchange Commission is seeking to force a convicted insurance mogul at the center of an alleged $57 million fraud to tell it what happened to the money he's accused of stealing from the insurance companies he ran, arguing in a North Carolina federal court that his answers thus far don't add up and that he shouldn't be allowed to rely on them at his upcoming trial.
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August 28, 2024
Fla. Bank City National Says Applebee's Franchisees Owe $8M
City National Bank of Florida sued a Louisiana-based Applebee's franchisee and three of its subsidiaries for $8.3 million, saying in a complaint filed Wednesday in Florida federal court that the companies defaulted on a federal COVID-19-era loan and then transferred control of their restaurants without consent.
Expert Analysis
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Regulators Are Revamping Use Of Bank Service Company Act
Excerpt from Practical Guidance
Though the Bank Service Company Act was written six decades ago, banks and service providers should be alert to the evolving ways financial regulators are using the law as a tool for scrutinizing bank-fintech partnerships and third-party service providers that could put consumers at risk, say James Bergin and Paul Lim at Arnold & Porter.
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Managing Credit Card Rewards Programs Amid Scrutiny
Renewed New York and federal interest in consumer protection issues associated with credit card rewards programs presages future regulatory enforcement and attention from plaintiffs attorneys, so issuers should focus on certain categories of consumer complaints and some compliance ambiguities, say Rich Zukowsky and Ella Beres at Davis Wright.
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Whistleblowers Must Note 5 Key Differences Of DOJ Program
The U.S. Department of Justice’s recently unveiled whistleblower awards program diverges in key ways from similar programs at other agencies, and individuals must weigh these differences and look first to programs with stronger, proven protections before blowing the whistle, say Stephen Kohn and Geoff Schweller at Kohn Kohn.
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What NFL Draft Picks Have In Common With Lateral Law Hires
Nearly half of law firm lateral hires leave within a few years — a failure rate that is strikingly similar to the performance of NFL quarterbacks drafted in the first round — in part because evaluators focus too heavily on quantifiable metrics and not enough on a prospect's character traits, says Howard Rosenberg at Baretz+Brunelle.
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CrowdStrike Incident Highlights Third-Party Risk For Banks
The global business disruptions caused by CrowdStrike's faulty software update last month serves as a reminder that banks should assess operational and compliance risks associated with third-party service providers and create resiliency plans extending down to fourth- and fifth-level providers, says Craig Landrum at Jones Walker.
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Open Questions 3 Years After 2nd Circ.'s Fugitive Ruling
The Second Circuit’s 2021 decision in U.S. v. Bescond, holding that a French resident indicted abroad did not meet the legal definition of a fugitive, deepened a circuit split on the fugitive disentitlement doctrine, and courts continue to grapple with the doctrine’s reach and applicability, say attorneys at Lankler Siffert.
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Replacing The Stigma Of Menopause With Law Firm Support
A large proportion of the workforce is forced to pull the brakes on their career aspirations because of the taboo surrounding menopause and a lack of consistent support, but law firms can initiate the cultural shift needed by formulating thoughtful workplace policies, says Barbara Hamilton-Bruce at Simmons & Simmons.
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Crypto Regs Could See A Reset Under The Next President
Donald Trump has taken a permissive policy stance favoring crypto, while Kamala Harris has been silent on the issue, but no matter who wins the presidential election, we may see a more lenient regulatory climate toward the digital currency than from the Biden administration, says Liam Murphy at McKool Smith.
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Planning Law Firm Content Calendars: What, When, Where
During the slower month of August, law firms should begin working on their 2025 content calendars, planning out a content creation and distribution framework that aligns with the firm’s objectives and maintains audience engagement throughout the year, says Jessica Kaplan at Legally Penned.
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Key Concerns To Confront In FDIC Brokered Deposit Proposal
Banks and fintech companies should note several fundamental issues with the Federal Deposit Insurance Corp.'s recent proposal to widen how it classifies brokered deposits, an attempt to limit prudential risk that could expose the industry and underbanked consumers who rely on bank-fintech apps to widespread unintended consequences, say attorneys at Gibson Dunn.
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4 Steps To Address New Sanctions Time Bar Extension
Recent guidance from the Office of Foreign Assets Control clarifies details of the newly extended statute of limitations for civil and criminal enforcement of U.S. sanctions law, so compliance teams should implement key updates, including to lookback periods and recordkeeping policies, say attorneys at Freshfields.
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Insuring Lender's Baseball Bet Leads To Major League Dispute
In RockFence v. Lloyd's, a California federal court seeks to define who qualifies as a professional baseball player for purposes of an insurance coverage payout, providing an illuminating case study of potential legal issues arising from baseball service loans, say Marshall Gilinsky and Seán McCabe at Anderson Kill.
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Implementing Proposed AML Rules May Take More Guidance
Two recent rules proposed by financial regulators would modernize requirements for programs aimed at countering money laundering and terrorist financing by centering more robust risk assessments, but financial institutions may need more specific guidance before they could confidently comply, say Meghann Donahue and Nikhil Gore at Covington.
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Series
Playing Golf Makes Me A Better Lawyer
Golf can positively affect your personal and professional life well beyond the final putt, and it’s helped enrich my legal practice by improving my ability to build lasting relationships, study and apply the rules, face adversity with grace, and maintain my mental and physical well-being, says Adam Kelly at Venable.
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What To Expect From CFPB And DOT Card Rewards Inquiry
Following the Consumer Financial Protection Bureau's announcement of joint efforts with the U.S. Department of Transportation to investigate credit card rewards points, credit card issuers and airlines should keep a close eye on potential regulatory and class action litigation risks stemming from the inquiry, say attorneys at DLA Piper.