August 30, 2018
CFTC issued an Order filing and settling charges against BNP Paribas Securities Corp. for attempted manipulation of the ISDAFIX benchmark and requiring BNP Paribas to pay a $90 million civil monetary penalty. The CFTC Order finds that beginning in or about May 2007 and continuing through at least August 2012, BNP Paribas attempted to manipulate the U.S. Dollar International Swaps and Derivatives Association Fix (USD ISDAFIX), a leading global benchmark referenced in a range of interest rate products, to benefit BNP Paribas's derivatives positions in instruments such as cash-settled options on interest rate swaps and certain exotic structured products. BNP Paribas's unlawful conduct involved multiple traders and included supervisors. In addition to the $90 million civil monetary penalty, the Order requires BNP Paribas to cease and desist from further violations as charged, and take specified remedial steps, including measures to detect and deter trading intended to manipulate swap rates such as the USD ISDAFIX, to ensure the integrity and reliability of the Bank's benchmark submissions, and to improve related internal controls. In accepting the BNP Paribas's Offer, CFTC recognized the bank's cooperation with the Division of Enforcement's investigation, and the federal regulator purportedly took note that the bank had "commenced significant remedial action to improve internal controls and policies related to all benchmarks, including ISDAFIX and its successor benchmark, independent of the Commission's investigation." READ the FULL TEXT CFTC Order
Former broker and investment adviser Gary Basralian pled guilty in the United States District Court for the District of New Jersey to an Information charging him with one count each of wire fraud and investment adviser fraud. From July 2007 through November 2017, Basralian defrauded his clients by falsely telling them that he would invest their money in securities and other investments when, in fact, he admitted to stealing at least $2 million, and misappropriated those funds and used them for his own personal expenditures - including payments on a BMW automobile and tens of thousands of dollars in credit card bills. On May 22, 2018, the N.J. Bureau of Securities in the Office of the N.J. Attorney General issued a summary revocation order against Basralian that revoked his agent and investment adviser representative registrations. READ the FULL TEXT Information
The RIABiz article begins with this introductory note:
Some RIABiz articles get passing interest. Others have legs. Some run like Frank Shorter. This article was one of those: How Morgan Stanley and a lesbian super-producer came to grief in South Carolina and why she alleges bias The story ran four years ago, but the subject, Libby Cherrington, didn't see her problems end there. In a filing on a remote part of FINRA's website, she's being called to task, again, for what looks like a little white lie. But the outcome is anything but small and adds to her long history of regulatory and legal run-ins.
Musk was a twit for tweeting out his half-baked idea in the first place, but that the investing public would buy close to $12 billion in Tesla stock on a tweet says more about us than about him. People bet on Tesla going private because Elon Musk thought about it out loud on Twitter. But people bet on lots of things for no good reason. Since Tesla is not actually going private, and Musk never said that it was, what stance should securities law take?
Pursuant to a Complaint and and Indictment filed in the United States District Court for the Southern District of New York, Marcos Elias was charged with one count each of conspiracy to commit wire fraud, wire fraud, and receipt of stolen property; and two counts of aggravated identity theft, The charges are in connection with Elias's alleged role in fraudulently obtaining over $750,000 at financial institutions using false representations and the stolen identities of Brazilian account holders. The alleged wire fraud scheme used a front company in Panama and a bank account in Luxembourg. READ the FULL TEXT
Complaint https://www.justice.gov/usao-sdny/press-release/file/1090346/download Indictment https://www.justice.gov/usao-sdny/press-release/file/1090351/download In a Complaint filed in the United States District Court for the District of New Jersey, the SEC alleged that Sandy J. Masselli, the Chairman and CEO of various entities including Carlyle Gaming & Entertainment Ltd. and Carlyle Entertainment Ltd., fraudulently raised some $3 million from investors. The Complaint alleged that Masselli falsely claimed that the companies were on the verge of conducting a lucrative initial public offering and would soon be listed on major U.S. stock exchanges. Masselli allegedly used investors' money to pay personal expenses. READ the FULL TEXT COMPLAINT https://www.sec.gov/litigation/complaints/2018/comp24248.pdf
In a Complaint filed in the United States District Court for the Northern District of Illinois
, the SEC alleged that Defendants Equitybuild, Inc. Equitybuild Finance, LLC, Jerome H. cohen, and Shaun D. Cohen sold at least $135 million in unregistered promissory notes to at least 900 investors throughout the country. https://www.sec.gov/litigation/complaints/2018/comp24237.pdf The Court entered a partial judgment against defendants Jerome Cohen and Shaun Cohen that imposes a permanent injunction against future violations by Jerome Cohen and Shaun Cohen of the antifraud provisions of cited sections of the '33 and '34 Acts; and further prohibits Jerome and Shaun Cohen from soliciting any new investors for the remaining duration of the litigation. The Cohens consented to the previously entered order appointing a receiver to continue until the final disposition of the case.
In a Complaint filed in the United States District Court for the District of Maine, the SEC alleged that Richard J. Greenlaw raised approximately $500,000 from at least 59 investors by offering securities in 20 cannabis-related entities that he formed, which purportedly sold medical marijuana products that did not contain the chemical THC. Allegedly, although no registration statement was on file or in effect with the SEC, Greenlaw sold ownership interests in the companies by posting advertisements on Craigslist, and responded to investor queries with securities offering documents and sales materials. Greenlaw and the 20 cannabis-related entities consented to the entry of a final judgment imposing permanent injunctions; and Greenlaw consented to a conduct-based injunction. The settlement also requires Greenlaw to pay disgorgement and prejudgment interest of $340,142 and a civil penalty of $50,000. READ the FULL TEXT Complaint
In a Complaint filed in the United States District Court for the Eastern District of Pennsylvania, the SEC alleged that professional football player Mychal Kendricks and a former investment banker Damilare Sonoiki engaged in insider trading in advance of corporate acquisitions facilitated through coded text messages and FaceTime conversations. The Complaint alleges that Kendricks made $1.2 million in illegal profits, and, thereafter rewarded Sonoiki. The U.S. Attorney's Office for the Eastern District of Pennsylvania today announced parallel criminal charges against Kendricks and Sonoiki.