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securities fraud 42 articles

SEC Awards Overseas Whistleblower $4 Million

The U.S. Securities and Exchange Commission (SEC) said it has paid nearly $4 million to an overseas whistleblower whose “extensive assistance” helped regulators take a successful enforcement action against the offending company. “Whistleblowers, whether they are located in the U.S. or abroad, provide a valuable service to investors and help us stop wrongdoing,” said Jane Norberg, Chief of the SEC’s Office of the Whistleblower, in a Sept. 24 announcement. “This award recognizes the continued, important assistance provided by the whistleblower throughout the course of the investigation.” September has been an active month for the SEC’s Whistleblower program, which has been ... Read More

Another Tesla Whistleblower Files SEC complaint

A second Tesla whistleblower has filed a formal complaint with the U.S. Securities and Exchange Commission (SEC), alleging a Mexican drug cartel operated within the automaker’s Nevada Gigafactory, while others stole $37 million in copper and other raw materials. Instead of properly notifying investors and regulators, Tesla CEO Elon Musk responded to the predicaments by illegally wiretapping and hacking employee cell phones and computers, whistleblower Karl Hansen alleges. Mr. Hansen, who worked for Tesla’s internal security department and investigations division, says he voiced his concerns internally, urging Tesla to take proper action in responding to the issues. But instead of ... Read More

SEC Proposes Changes to its Whistleblower Program

The Securities and Exchange Commission (SEC) has proposed a series of changes to its whistleblower program that the agency says will boost the efficiency and overall performance of its informant-driven enforcement actions. The SEC added the proposed amendments to the whistleblower program to the Federal Register July 20. The changes would provide the SEC with additional tools to ensure that whistleblowers are appropriately rewarded for their efforts, the agency said. The SEC also proposed ways to increase efficiency in the whistleblower claims review process and to clarify the requirements for whistleblower anti-retaliation protections. The SEC’s whistleblower program was established by ... Read More

SEC Awards ‘Safe Harbor’ Whistleblower $2.2 Million

The U.S. Securities and Exchange Commission (SEC) has awarded a whistleblower more than $2.2 million for tips that led to a successful enforcement action against a company for violations of securities laws. This latest SEC whistleblower award is unique in that it was the first such award paid under the SEC’s “safe harbor” rule, which accommodates whistleblowers who submit tips and other information to another federal agency before reporting it to the SEC. The “safe harbor” provision of the Exchange Act Rule provides that if a whistleblower submits information to another federal agency and then submits the same information to ... Read More

Record SEC and CFTC Whistleblower Awards Given In JPMorgan Case

Whistleblowers who provided tips to federal regulators about JPMorgan Chase & Co.’s failure to properly inform some wealthy investors about conflicts of interest are set to receive record monetary awards. The whistleblowers helped the Securities and Exchange Commission (SEC) and the U.S. Commodity Futures Trading Commission (CFTC) put the brakes on JPMorgan’s misconduct, resulting in a record $367 million asset-management agreement. According to Bloomberg, the record JPMorgan settlement included $100 million that went to the CFTC, “described as a $40 million monetary penalty and $60 million in disgorgement.” The bank also agreed to pay the SEC an additional $267 million. ... Read More

SEC Sues Two NY Securities Brokers For Defrauding Customers

The Securities and Exchange Commission (SEC) said it charged two New York-based brokers with making unsuitable trades that were costly for customers but highly profitable for the brokers. In a Dec. 6 announcement, the SEC said it filed a complaint in Manhattan federal court against Zachary S. Berkey of Centerreach, New York, and Daniel T. Fischer of Greenwich, Connecticut, alleging the brokers “conducted in-and-out trading that was almost certain to lose money for customers while yielding commissions for themselves. “ According to the SEC’s complaint, 10 customers of Four Points Capital Partners LLC, where Mr. Berkey and Mr. Fischer previously worked, lost a ... Read More

SEC Awards Two Whistleblowers More Than $16 Million

Two whistleblowers will each receive an award of more than $8 million from the Securities and Exchange Commission (SEC) for their role in helping the agency take action against a company’s wrongdoing. According to the SEC, the first whistleblower alerted the agency’s enforcement staff of specific misconduct that would become the focus of a federal investigation and the cornerstone of the SEC’s subsequent enforcement action. The second whistleblower also played a key role in providing investigators with additional information and ongoing cooperation throughout the probe. The SEC said that this whistleblower’s help saved a substantial amount of time and SEC ... Read More

SEC Whistleblower Clears Hurdles For $1.7 Million Award

A whistleblower who helped the Securities and Exchange Commission (SEC) return millions of dollars to investors harmed by company fraud will collect an award of more than $1.7 million, clearing regulatory hurdles that could have barred an award in other circumstances. In its July 27 announcement – the second whistleblower announcement that week – the SEC noted that an enforcement action against the company would have been difficult to detect had it not been for the information provided by the whistleblower. That information helped the SEC uncover a “multi-year fraud” and make a recovery for investors was pivotal, but the agency ... Read More

Alabama company Pays New York State $40 Million To Settle False Claims Act Tax Fraud Case

An Alabama investment group and some of its top executives have agreed to pay New York State $40 million to settle a New York False Claims Act lawsuit brought by a whistleblower who claimed the company committed tax fraud, cheating New York out of millions of dollars in taxes. The settlement is the largest-ever recovery of its kind since New York’s False Claims Act law was expanded to include tax claims. It resolves allegations that Birmingham-based Harbert Management Corporation, sponsor of Harbinger Capital Partners, a $26 billion New York City-based hedge fund, failed to pay millions in state taxes on ... Read More

Judge Rules Whistleblowers Can Provide SEC with Confidential Documents To Substantiate Fraud Claims

A San Diego federal judge’s Feb. 14 ruling in a whistleblower dispute involving Bank of Internet (BofI) and a former employee who provided classified information to federal regulators about potential securities violations enhances protections for certain whistleblowers who report fraud. According to Courthouse News Service, U.S. District Judge Cynthia Bashant denied most of BofI’s motions for a summary judgement of whistleblower protections from Charles Matthew Erhart, who was formerly employed as BofI’s internal auditor. Mr. Erhart started working for San Diego-based BofI in September 2013. He reported the bank to the Securities and Exchange Commission (SEC) upon discovering it worked ... Read More