The U.S. Supreme Court has upheld the SEC’s ability to obtain disgorgement in enforcement cases. However, the decision also put limits on how much disgorgement can be obtained. The Supreme Court held that the SEC can obtain disgorgement of ill-gotten gains in federal court, but the disgorgement cannot exceed the defendant’s net profit from the scheme. In the Opinion, the Supreme Court found that “legitimate expenses” could be deducted from net profit when calculating disgorgement.
Former First Standard Financial broker, Frank Venturelli, agreed to pay restitution of $30,000 and to serve an 11-month suspension from association with any FINRA member firm in all capacities. According to FINRA Enforcement, Venturelli engaged in excessive trading in three customer accounts between July 2016 and November 2018.
Brothers Sean and Shane Hvizdzak have been charged by the U.S. Securities and Exchange Commission (“SEC”) for allegedly misappropriating investor money from High Street Capital Fund USA LP, a cryptocurrency investment fund. The SEC also alleges that the Hvizdzaks misrepresented the fund’s performance to investors. The U.S. District Court granted the SEC’s request to freeze the Hvizdzaks’ assets and for a temporary restraining
In a landmark ruling, the U.S. Supreme Court ruled that Title VII of the Civil Rights Act prohibits discrimination based on gender identity and sexual orientation.
The COVID-19 pandemic is taking a toll on the hedge fund industry. Barclays Capital Solutions is reporting that between $50 billion and $100 billion may be pulled out of hedge funds by investors in 2020. This year could see the largest withdrawal of investor funds from hedge funds since 2008 when investors withdrew $154 billion.
This is the first in a 3-part series addressing the CFP Board’s new self-reporting requirements that went into effect on October 1, 2019. Among the changes in the new rule is an expansion of the self-reporting requirements for CFP professionals. Like the old rule, the new rule requires a CFP professional to self-report to the CFP board within 30 calendar days.
The Financial Industry Regulatory Authority (“FINRA”) filed a Complaint against Adam James Makkai alleging that he shared commissions with an unregistered former coworker. FINRA Enforcement alleged that Makkai, a former LPL Financial advisor, shared commissions with a former LPL advisor who had been terminated.
The U.S. Securities and Exchange Commission’s (“SEC”) investment advice reform rules, which include Regulation Best Interest (“Reg. B-I”), are set to take effect at the end of June. The new rules will require SEC-registered advisers to complete a client relationship summary, or Form CRS. As part of the client relationship summary, advisers will be required to disclose their services, fees, costs, disciplinary history , conflicts of interest and the standard of conduct by which they are governed.
UBS Wealth Management USA has filed a lawsuit against former advisor, Alexandra VanMeurs. After 13 years at UBS, VanMeurs left the firm in May to join Morgan Stanley. UBS is seeking to enjoin VanMeurs from calling clients she serviced at UBS. Although such lawsuits are not uncommon in the industry, the case has an interesting twist.
MetLife has agreed to pay $84 million to settle class action claims that it underreported life insurance death benefit liabilities and misled investors. The settlement concludes eight years of litigation, which included multiple formal mediation sessions. The original complaint was filed in 2012, and the class was certified in 2017. The class of plaintiffs includes investors who acquired MetLife common stock during certain offerings in 2010 and 2011.
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The Securities and Exchange Commission (SEC) is ramping up its enforcement efforts targeting off-channel communications, particularly text messages, among investment advisory firms.
B. Riley Financial Inc. has encountered a setback in filing its audited results within an extended timeframe, adding to existing pressure amid concerns raised by short sellers regarding its association with a former business partner.
A former advisor with Wells Fargo Advisors Financial Network (FiNet) in Chicago, Jayson R. Pocius, has agreed to accept an industry bar rather than cooperate with a
Financial Industry Regulatory Authority (FINRA) investigation into allegations of misusing client funds.
