Capital Markets & Securities Law Watch

Recent enforcement actions targeting a CEO, CFO, and an audit committee chair underscores the SEC's focus on gatekeeper accountability.

The Securities and Exchange Commission recently announced charges and million-dollar penalties against four companies for allegedly making materially misleading disclosures regarding cybersecurity risk and intrusions relating SolarWinds hack.

On September 25, 2024, the Securities and Exchange Commission (the SEC) announced settled charges against 25 entities and individuals for late beneficial-ownership and insider-transaction reports. The SEC had levied penalties on these filers because of failures to timely report information about their holdings and transactions in public-company stock. Without admitting or denying the charges, 2 public companies, 13 other entities, and 10 individuals agreed to cease committing and causing violations and pay civil penalties. The civil penalties ranged from $10,000 to $200,000 for individuals, and $40,000 to $750,000 for the entities involved, including $200,000 each for two public companies that were charged with contributing to filing failures by certain corporate insiders and failing to report their insiders’ filing delinquencies.

The U.S. Department of Justice recently succeeded in its prosecution of former Ontrak CEO Terren Peizer for insider trading, which involved the misuse of his 10b5-1 trading plan. This post provides an overview of the case’s background and outcome, and highlights key lessons that directors and officers of public companies should consider.

On May 3, 2024, the SEC announced charges against audit firm BF Borgers CPA PC and its owner, Benjamin F. Borgers, of deliberate and systemic failures to comply with PCAOB standards in its audits and reviews incorporated in over 1,500 SEC filings from January 2021 through June 2023, in what the SEC called “one of the largest wholesale failures by gatekeepers in our financial markets.” In this post, we review the SEC’s order and the SEC staff’s statement regarding the disclosure and reporting obligations of impacted issuers.

With consumer and investor interest in artificial intelligence (AI) surging, there has been heightened concern among regulatory agencies, including the Federal Trade Commission (FTC) and the Securities and Exchange Commission (SEC), with companies engaging in a deceptive practice the FTC and SEC have dubbed “AI washing.”

Industry professionals are keeping tabs on the regulation of crypto assets, as the U.S. Securities and Exchange Commission (SEC) turns its attention to the burgeoning asset class. A pair of prepared remarks delivered by SEC Chair Gary Gensler over the past few months underscore the SEC’s commitment to enforcement and increased regulatory oversight of crypto assets.