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Fintech
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September 24, 2024
Feds Say BitMEX Should Owe $428M For Flouting AML Rules
Federal prosecutors urged a Manhattan federal judge to impose a $428 million penalty for offshore crypto derivatives exchange BitMEX after the firm admitted to lax anti-money laundering procedures, arguing the more than $100 million the firm and founders have already paid to regulators is not enough to deter other crypto firms from Bank Secrecy Act violations.
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September 24, 2024
1st Circ. Affirms Tossing Of IRS Crypto Doc Seizure Case
A New Hampshire federal court correctly dismissed a bitcoin investor's claim that the IRS violated his privacy and property rights when it seized his records from the cryptocurrency exchange Coinbase, the First Circuit ruled Tuesday, agreeing that he lacked a reasonable expectation that his account information would be kept private.
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September 24, 2024
Chancery Told SwervePay Deserves Sanctions In Earnout Suit
A court-appointed special magistrate has recommended sanctioning e-payment venture SwervePay and related parties over up to 22 months of missing or deleted text messages sought by SPOSC Investment Holdings and others in a post-merger battle over an alleged multibillion-dollar overstatement of "monetizable" payment traffic.
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September 24, 2024
Star Witness Against Bankman-Fried Gets 2 Years In FTX Case
A Manhattan federal judge sentenced former cryptocurrency executive Caroline Ellison to two years in prison Tuesday, crediting her decision to testify against FTX founder Sam Bankman-Fried but saying the $11.2 billion fraud was too big to warrant a "get out of jail free card."
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September 24, 2024
Baker Donelson Adds Financial Services Expert In DC
Baker Donelson Bearman Caldwell & Berkowitz PC has hired a new shareholder who started her 15-year legal career as an attorney adviser in the U.S. Department of the Treasury's Banking and Finance Division, the firm announced Tuesday.
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September 24, 2024
DOJ Accuses Visa Of Monopolizing Debit Card Market
The U.S. Department of Justice accused Visa on Tuesday of illegally maintaining a monopoly over debit card networks by using its dominance to thwart competition from new and existing rivals, as the Biden administration continues its push to combat high prices using antitrust law.
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September 24, 2024
SEC, CFTC Issue $118M Fines In Latest Text Message Actions
Federal regulators said Tuesday that the Canadian Imperial Bank of Commerce and nearly a dozen other financial firms have agreed to pay fines totaling nearly $120 million to settle recordkeeping violations tied to employee use of unapproved communication methods like text messages to conduct business.
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September 23, 2024
3rd Circ. Probes SEC's 'Close To Vacuous' Reply To Coinbase
Members of a Third Circuit panel on Monday pressed the U.S. Securities and Exchange Commission on its brief denial of crypto exchange Coinbase's request for rulemaking around digital assets, digging into how much of an explanation the agency owes the industry about its decision to forego setting rules for now.
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September 23, 2024
Crypto Miners Must Keep Fighting SEC's $18M Fraud Claims
A Utah federal judge on Monday refused to throw out the U.S. Securities and Exchange Commission's suit accusing two Utah residents of running an $18 million crypto fraud scheme, rejecting their arguments that the transactions at the heart of the dispute do not involve securities subject to the SEC's regulation.
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September 23, 2024
Coinbase Brings On Ex-Citadel Legal Chief With SEC Chops
Coinbase announced on Monday it has hired Ryan VanGrack to serve as its vice president of legal, where he will be overseeing civil litigation, regulatory probes, employment and intellectual property matters for the crypto exchange after spending seven years with Citadel Securities as general counsel.
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September 23, 2024
CFTC Fines Piper Sandler $2M In Latest Text Messaging Action
The U.S. Commodity Futures Trading Commission and the U.S. Securities and Exchange Commission both announced settlements Monday in their ongoing probe into the financial industry's use of personal devices to discuss company business, with the CFTC issuing a fine against a subsidiary of Piper Sandler & Co. while the SEC said that a cooperative investment adviser would not have to pay anything.
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September 23, 2024
DOJ Adds AI Risk To Corporate Compliance Program
The U.S. Department of Justice's Criminal Division is now weighing how companies manage risk related to artificial intelligence and potentially stymie whistleblowers, one of several updates to the division's policies on evaluating corporate compliance programs announced by a senior official on Monday.
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September 23, 2024
SEC Scores $12M Judgment In Unregistered Dealer Case
A Minnesota federal judge has ordered financial firm Carebourn Capital LP, its founder and an affiliated company to pay more than $12 million in disgorgement and prejudgment interest over U.S. Securities and Exchange Commission claims they made millions selling securities as unregistered dealers.
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September 23, 2024
PNC, Plaid End Legal Battle With Customer Data-Sharing Deal
PNC Financial Services Group and Plaid have reached an agreement to end nearly four years of trademark litigation that allows PNC customers to use Plaid to share their financial data with fintech companies like Venmo and Cash App.
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September 23, 2024
Davis Polk Vows Ex-Clerk Won't Touch Crypto Merger Suit
Local counsel for Galaxy Digital Holdings Inc. has told a Delaware vice chancellor that Davis Polk & Wardwell LLP will ensure that an incoming associate who clerked for the state's Supreme Court won't share information with attorneys defending the digital assets company in a merger suit that the state's highest court revived in May.
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September 23, 2024
Shkreli Told To Provide More Info On Wu-Tang Album Copies
A Brooklyn federal judge on Monday ordered Martin Shkreli to update the court on how many tracks he copied from a one-of-a-kind Wu-Tang Clan album after the cryptocurrency group that now owns the work argued Shkreli could be holding out on surrendering all his copies amid the parties' legal battle.
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September 23, 2024
Holland & Knight Adds Former Treasury Adviser In DC
A former adviser for the U.S. Department of the Treasury and counsel for the Consumer Financial Protection Bureau has moved his practice to Holland & Knight's office in Washington, D.C., the firm announced Monday.
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September 23, 2024
Autism Played Role In Bankman-Fried Case, 2nd Circ. Told
A group of experts on neurodiversity told the Second Circuit that Sam Bankman-Fried, who has said he has autism and attention deficit hyperactivity disorder, may have been hurt at trial by a "cognitive and communication style" that at times frustrated the trial judge.
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September 20, 2024
3rd Circ. CFPB Ruling Threatens Securitization, Justices Told
Two major trade groups for the securities industry have urged the U.S. Supreme Court to review a Third Circuit decision allowing the Consumer Financial Protection Bureau to exercise enforcement authority over a collection of student loan securitization trusts, slamming the ruling as wrong and dangerous.
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September 20, 2024
Judge Won't Toss Fraud Suit Against Crypto-Forex Co. Execs
A Florida judge decided that the CEO and a founding shareholder of purported foreign exchange currency broker FxWinning Ltd. have sufficient ties to Florida to keep them among the defendants of a suit alleging the business and its operators perpetrated a multimillion-dollar fraud.
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September 20, 2024
CFPB Pitches Remittance Rule Tweak For Consumer Inquiries
The Consumer Financial Protection Bureau moved Friday to revise a longstanding remittance disclosure requirement, saying the agency thinks the wording may be causing it to get inundated with thousands of phone calls from consumers asking about their international money transfers.
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September 20, 2024
States Tell 10th Circ. To Back Colo. Interest Rate Opt-Out Law
Attorneys general for 13 states and Washington, D.C., asked the Tenth Circuit on Friday to uphold a Colorado law imposing more restrictive interest rate caps on loans made to its residents by out-of-state banks, arguing that a federal judge's injunction "nullifies the authority granted to states by Congress" to protect consumers from abusive lending practices.
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September 20, 2024
NFT Buyers Bring Securities Suit Against Crypto Co. OpenSea
Two Florida users of OpenSea hit the nonfungible token marketplace with a proposed securities class action claiming the assets the users bought on the platform are unregistered investment contracts in light of recent court decisions and regulatory scrutiny from the U.S. Securities and Exchange Commission.
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September 20, 2024
2 SEC Commissioners Object To Whistleblower Award Secrecy
U.S. Securities and Exchange Commissioners Mark Uyeda and Hester Peirce have objected to the agency's recent decision to hand out a total of $122 million in two awards to four whistleblowers and issued a statement taking issue with the regulator's policy of saying little to nothing about why the rewards are issued.
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September 20, 2024
Silvergate Wants Activist Investor's Board Seat Play Blocked
The parent company of Silvergate Bank, a defunct bank that catered to the cryptocurrency industry, has asked the judge in its Delaware bankruptcy case to help head off what it described as an activist investor's effort to score a seat on the debtor's board so he can try to secure a payout for shareholders who are set to receive nothing under a Chapter 11 plan.
Expert Analysis
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Litigation Inspiration: Attys Can Be Heroic Like Olympians
Although litigation won’t earn anyone an Olympic medal in Paris this summer, it can be worthy of the same lasting honor if attorneys exercise focused restraint — seeking both their clients’ interests and those of the court — instead of merely pursuing every advantage short of sanctionable conduct, says Bennett Rawicki at Hilgers Graben.
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What To Know As CFPB Late Fee Rule Hangs In Limbo
Though the Consumer Financial Protection Bureau's final credit card late fee rule faces an uncertain future due to litigation involving injunctions, emergency petitions and now a venue dispute, card issuers must understand how to navigate the interim period and what to do if the rule takes effect, say attorneys at Steptoe.
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Lean Into The 'Great Restoration' To Retain Legal Talent
As the “great resignation,” in which employees voluntarily left their jobs in droves, has largely dissipated, legal employers should now work toward the idea of a “great restoration,” adopting strategies to effectively hire, onboard and retain top legal talent, says Molly McGrath at Hiring & Empowering Solutions.
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Unlocking Blockchain Opportunities Amid Legal Uncertainty
Dozens of laws and legal precedents will come into the fore as Web3, metaverse and non-fungible tokens gain momentum, so organizations need to design their programs with a broader view of potential exposures — and opportunities, say Teresa Goody Guillén and Robert Musiala at BakerHostetler and Steve McNew at FTI Consulting.
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What The NYSE Proposed Delisting Rule Could Mean For Cos.
The New York Stock Exchange's recently proposed rule would provide the exchange with discretionary authority to commence delisting proceedings for a company substantially shifting its primary business focus, raising concerns for NYSE-listed companies over the exact definition of the exchange's proposed "substantially different" standard, say attorneys at Winston & Strawn.
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The Uncertain Scope Of The First Financial Fair Access Laws
With Florida and Tennessee soon to roll out laws banning financial institutions from making decisions based on customer traits like political affiliation, national financial services providers should consider how broadly worded “fair access” laws from these and other conservative-leaning states may place new obligations on their business operations, say attorneys at Sullivan & Cromwell.
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Debate Over CFPB Definition Of Credit Is Just Beginning
The Consumer Financial Protection Bureau has recently worked to expand the meaning of credit, so anyone operating on the edges of the credit markets, or even those who assumed they were safely outside the scope of this regulatory perimeter, should pay close attention as legal challenges to broad interpretations of the definition unfold, says John Coleman at Orrick.
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A Closer Look At Feds' Proposed Banker Compensation Rule
A recently proposed rule to limit financial institutions' ability to award incentive-based compensation for risk-taking may progress through the rulemaking process slowly due to the sheer number of regulators collaborating on the rule and the number of issues under consideration, say attorneys at Troutman Pepper.
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Opinion
The FTC And DOJ Should Backtrack On RealPage
The antitrust agencies ought to reverse course on their enforcement actions against RealPage, which are based on a faulty legal premise, risk further property shortages and threaten the use of algorithms that are central to the U.S. economy, says Thomas Stratmann at George Mason University.
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Series
Fishing Makes Me A Better Lawyer
Atop the list of ways fishing makes me a better lawyer is the relief it offers from the chronic stress of a demanding caseload, but it has also improved my listening skills and patience, and has served as an exceptional setting for building earnest relationships, says Steven DeGeorge at Robinson Bradshaw.
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A Look At US-EU Consumer Finance Talks' Slow First Steps
The unhurried and informal nature of planned discussions between the U.S. Consumer Financial Protection Bureau and the European commissioner for justice and consumer protection suggests any coordinated regulatory action on issues like AI and "buy now, pay later" services is still a ways off, say attorneys at DLA Piper.
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5th Circ. Venue-Transfer Cases Highlight Mandamus Limits
Three ongoing cases filed within the Fifth Circuit highlight an odd procedural wrinkle that may let district courts defy an appellate writ: orders granting transfer to out-of-circuit districts, but parties opposing intercircuit transfer can work around this hurdle to effective appellate review, says Charles Fowler at McKool Smith.
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A Healthier Legal Industry Starts With Emotional Intelligence
The legal profession has long been plagued by high rates of mental health issues, in part due to attorneys’ early training and broader societal stereotypes — but developing one’s emotional intelligence is one way to foster positive change, collectively and individually, says attorney Esperanza Franco.
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Navigating Self-Disclosures As A Regulated Financial Entity
As enforcement risks heat up for regulated financial institutions, such entities may be forced to weigh the potential advantages and disadvantages of self-disclosing potential compliance gaps, say attorneys at Jenner & Block.
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To Make Your Legal Writing Clear, Emulate A Master Chef
To deliver clear and effective written advocacy, lawyers should follow the model of a fine dining chef — seasoning a foundation of pure facts with punchy descriptors, spicing it up with analogies, refining the recipe and trimming the fat — thus catering to a sophisticated audience of decision-makers, says Reuben Guttman at Guttman Buschner.