International Securities Regulation

Way back in 2017, the SEC obtained an emergency asset freeze against an internet-based ICO involving certain Canadian residents, who had raised over $15 million on a variety of social media sites through an alleged fraudulent scheme. http://www.sec.gov/litigation/complaints/2017/comp-pr2017-219.pdf.

At the time, it made major news and helped launch the SEC’s Cybersecurity Unit.  Of course, there 

The U.S. Attorney’s Office for the Southern District of New York has announced that its prosecutors will not be significantly impacted by a recent appellate court decision concluding that Morrison’s proscription against extraterritoriality applies also in the criminal context.

In United States v. Vilar, the United States Court of Appeals for the Second Circuit

Usually, we spend a fair amount of time advising our American broker-dealer clients, who do business overseas, that they have to follow the rules of those countries as well.  However, the “shoe” may sometimes be on the other “foot.”  See http://www.sec.gov/litigation/admin/2014/34-71593.pdf.

Recently, a foreign broker-dealer was forced to pay a 9 figure judgment to

A German company sought the Staff’s assurance that it does not have to register as a broker-dealer if it is retained outside the U.S. by non-U.S. clients in connection with certain M&A transactions, initiates contact directly with potential U.S. targets, and engages in additional activities regarding the U.S. targets.

The M&A transactions may involve the

The Staff of the Securities and Exchange Commission Division of Trading and Markets issued advice on Securities Exchange Act of 1934 Rule 15a-6, involving registration exemptions for foreign broker-dealers.  See http://www.sec.gov/divisions/marketreq/faq-15a-6-foreign-bd.htm.

In particular, Rule 15a-6 activities include when broker-dealers

  • effect unsolicited securities transactions; 
  • provide research reports to major U.S. institutional investors, and effect transactions in

Alas, the Dodd-Frank whistleblower protections cover informants overseas.

The United States Court of Appeals for the Fifth Circuit, recently, held that the Dodd-Frank whistleblower protections cover informants that report to the SEC information about FCPA violations.  The court, citing that the plain language of the act, indicated that such individuals were covered.  This is an intriguing

Companies that acquire or invest in offshore entities or in entities that conduct business overseas may inherit FCPA risks.

Clearly, the DOJ and the SEC are viewing these transactions and the resulting combinations with a jaundiced eye.  These regulators, most likely, will begin investigations, and, possibly, commence actions.  In fact, there have been recent FCPA actions

In light of the Urban decision, the SEC has indicated it intends on expounding on its views of failure to supervise for legal and securities personnel.

Although several of the federal securities laws indicate the SEC has the authority to bring actions for failing to supervise or detect securities law violations, there has been no true

Over the course of many years, I have been questioned by American BDs as to their responsibilities for sales to people outside the United States.  My response has always been that they are required to obtain an opinion from counsel in those jurisdictions before proceeding.  Most likely, those foreign jurisdictions may have registration requirements before conducting business in their

Although it has been somewhat circumspect, the SEC seems to be stalling on a move towards adopting the international accounting standards of International Financial Reporting Standards (“IFRS”).  Such an approach has left the Europeans in a tizzy!!

The United States has an interesting history with international accounting standards.  The SEC and the American accounting industry has in