SEC Extends Conditional Exemptions From Reporting and Proxy Delivery Requirements for Public Companies, Funds, and Investment Advisers Affected By Coronavirus Disease 2019 (COVID-19) / Division of Corporation Finance Issues Related Disclosure and Other Guidance. SEC Continues to Closely Monitor Impact of Coronavirus on Investors and Capital Markets (SEC Release)Morgan Stanley Customer Says Firm Misinformed Her About 403(b) Account Distributions, Nancy C. Huber, Claimant, vs. Morgan Stanley, Respondent (FINRA Arbitration Decision)FINRA Entertains Puerto Rico Bond Lawsuit Involving Over-Six-Year-Old "Purchase." Mariano Betancourt Figueroa and Cristina Quiles Santos, Claimants, vs. Oriental Financial Services Corp., Respondent (FINRA Arbitration Decision)
[H]alitron, Inc. and its CEO, Bernard Findley, issued false and misleading press releases that materially misrepresented Halitron's financial condition and the value of the company's assets in an effort to prop up the value of Halitron's stock and thereby attract financiers who provided funding to Halitron in exchange for discounted shares of Halitron stock. The press releases allegedly included false and misleading descriptions of a purported financing arrangement that Halitron had in place, and falsely claimed that Halitron was implementing a stock buyback program. Findley allegedly misappropriated a majority of the money Halitron received from the financiersby using those funds to cover personal expenses and pay off personal credit card debt.
[I]n 2012 the Financial Industry Regulatory Authority found that Hunter had committed fraud in connection with the sale of promissory notes to some of his broker-dealer clients, and permanently barred him from associating with any FINRA-registered firm. The complaint alleges that Hunter subsequently established You Angel Finance as a private fund with no FINRA registration. As alleged, from late 2016 through 2018, while acting as investment adviser to You Angel Finance, Hunter raised approximately $430,000 from investors, claiming that You Angel Finance was supplying seed capital to or purchasing shares from a private drug research company. The complaint alleges that Hunter had acquired the company's shares personally or through companies he controlled, but as a result of the FINRA bar he was unable to sell them directly or indirectly to brokerage customers, as he had in the past. The complaint further alleges that Hunter failed adequately to disclose that the fund purchased the shares from Hunter or entities he controlled, or that he set the prices at which he sold those shares to the fund.
As alleged in the Indictment filed in March 2011 in Manhattan federal court, PokerStars was founded in approximately 2001, with headquarters in the Isle of Man. PokerStars offered online poker games to players around the world, including in New York, New York. SCHEINBERG was PokerStars' founder and principal. On October 13, 2006, the United States enacted the Unlawful Internet Gambling Enforcement Act ("UIGEA"), making it a federal crime for gambling businesses to "knowingly accept" most forms of payment "in connection with the participation of another person in unlawful Internet gambling." With the enactment of UIGEA, leading internet gambling businesses - including the leading internet poker company doing business in the United States at that time - terminated their United States operations. However, PokerStars, along with Full Tilt Poker and Absolute Poker, continued illegally to make internet poker available to U.S. customers through March 2011.In pleading guilty today, SCHEINBERG admitted that he knew operating a business that offered internet poker to New Yorkers violated state law, and that it was the clear position of the U.S. government that offering online poker in the United States violated federal law. Nonetheless, Scheinberg decided to continue running his multimillion-dollar online poker business in the United States.In 2012, PokerStars and its related companies (the "PokerStars Companies") agreed to settle a civil forfeiture and civil money laundering action brought by the Office. That settlement involved, among other things, the PokerStars Companies forfeiting $547 million to the United States and assuming approximately $184 million in foreign player liabilities of another online poker company subject to the settlement. Additionally, in June 2013, Mark Scheinberg, ISAI SCHEINBERG's son, agreed to forfeit to the United States an additional $50 million of distributions he received from the operation of the PokerStars Companies.
extending the filing periods covered by its previously enacted conditional reporting relief for certain public company filing obligations under the federal securities laws, and that it is also extending regulatory relief previously provided to funds and investment advisers whose operations may be affected by COVID-19. In addition, the SEC's Division of Corporation Finance issued today its current views regarding disclosure considerations and other securities law matters related to COVID-19.. . .[S]ubject to certain conditions, provides public companies with a 45-day extension to file certain disclosure reports that would otherwise have been due between March 1 and July 1, 2020. Today's Order supersedes and extends the Commission's Original Order of March 4, 2020. Among other conditions, companies must continue to convey through a current report a summary of why the relief is needed in their particular circumstances for each periodic report that is delayed. The Commission may provide extensions to the time period for the relief, with any additional conditions it deems appropriate, or provide additional relief as circumstances warrant. Companies and their representatives are encouraged to contact SEC staff with questions or matters of particular concern.. . .[P]rovide certain investment funds and investment advisers with additional time with respect to holding in-person board meetings and meeting certain filing and delivery requirements, as applicable. Today's Orders supersede and extend the filing periods covered by the Commission's Original Orders of March 13, 2020. Among other conditions, entities must notify the Division staff and/or investors, as applicable, of the intent to rely on the relief, but generally no longer need to describe why they are relying on the order or estimate a date by which the required action will occur. The time periods for relief are described in the Orders. The Commission may provide extensions to the time period for the relief, with any additional conditions it deems appropriate, or provide additional relief as circumstances warrant. Firms and financial professionals are encouraged to contact SEC staff with questions or matters of particular concern.
repeatedly misinformed Claimant as to the procedure for taking a distribution from her403(b) account, resulting in undue delay and causing Claimant to incur an unnecessarytax liability and financial difficulties.
Bill Singer's Comment: Compliments to FINRA Arbitrator Dineo Coleman Gary for taking on a ticklish issue pertaining to FINRA's so-called Six Year Eligibility Rule. The Arbitrator stakes out an edgy yet compelling position that FINRA Rule 12206 does not preclude a claim involving an underlying purchase that is outside the six-year threshold, but, rather, the Rule countenances an "occurrence or event giving rise to the dispute" that falls within that horizon. Whether the Arbitrator's interpretation and characterization of the material events will prevail on appeal remains to be seen -- particularly since an appeal is not necessarily a given. Frankly, it looks like Claimants' lawyers, Mariano Betancourt Figueroa and Cristina Quiles Santos: Juan C. Blasini Gonzalez, Esq., Blasini Gonzalez Law Office, Guaynabo, Puerto Rico https://jcbglaw.com/home, did one hell of a job!On or about October 8, 2019, Respondent filed a Motion to Dismiss pursuant to Rule 12206(a) of the Code of Arbitration Procedure ("Code") in which it asserted, among other things, that the purchases in this matter predate April 23, 2013, and are thus ineligible for arbitration. In their Opposition to Motion to Dismiss dated October 15, 2019, Claimants asserted, among other things, that Rule 12206(a) of the Code does not provide that a claim must be brought within six years of the "purchase" of the security; rather, the rule explicitly provides that the claim must be brought within six years of the "occurrence or event giving rise to the dispute," which is an issue of fact for the Panel to decide. In its Reply to Opposition to Motion to Dismiss dated October 21, 2019, Respondent argued, among other things, that all of Claimants' substantive claims related to occurrences or events outside the six-year eligibility window. On or about October 22, 2019, Claimants filed a Sur-reply in Opposition to the Motion to Dismiss in which they argued, among other things, that Claimants' account continued to be damaged during the six-year eligibility period. On or about October 30, 2019, the Arbitrator issued an Order that denied Respondent's Motion to Dismiss.