In May of this year, a New York City jury convicted a man known as “Mr. T” for running a boiler room operation that defrauded dozens of American and Canadian victims. Of course, the defendant was not the famed actor. Instead, it was another man, Robert Lenard Booth. But the…
Continuing to award bounties to those who step up to report securities fraud, the SEC has recently awarded $5 million to a whistleblower for offering information and assistance. This information eventually led to a successful enforcement action where the SEC collected fines, sanctions, and other funds from the company. The…
Private placements are a specialized kind of securities offering generally open only to accredited investors—for the most part, high net-worth individuals and licensed brokers. Given the investors’ sophisticated understanding of securities transactions, private placements are not subject to the same rigorous disclosure requirements as public offerings. Because of this lower…
In one of the largest bounties awarded to a single whistleblower, the SEC in conjunction with another federal agency awarded a total $37 million to a whistleblower for information that led to two successful enforcement actions. The SEC, along with another federal agency that was not named, as well as…
We often hear about accounting fraud when a big case hits the news. For example: Xerox falsified its financial records for five years, inflating its earnings by $1.5 billion; Lehman Brothers failed to disclose an accounting loophole that reported short-term loans as sales; and Haliburton improperly overbooked cost overruns. When…
It’s a well-known rule in “polite society.” One simply should not discuss money. And when it comes to asking someone to divulge their salary, Miss Manners has admonished, “It is unequivocally impolite to ask anyone how much money they make. Even if he really wants to know.” And so perhaps…
In our last post, we were talking about how scammers are unfortunately robbing investors with claims that they can purchase pre-initial public offerings (IPOs). And how the Securities and Exchange Commission (SEC) and Financial Industry Regulatory Authority (FINRA), the not-for-profit overseeing broker-dealers, both effectively warn that, if someone’s not already…
In May 2022, the Securities and Exchange Commission (SEC) announced that it had filed an emergency action to freeze the assets of StraightPath Venture Partners and other defendants. The SEC alleged that the defendants were committing ongoing securities violations, having already racked up $410 million from 2,200 defrauded investors. The…
Securities sales is a hard business on a good day. And the pressure to sell and hit a quota is often hanging over many agents’ heads. That’s even more true when there’s a downturned market filled with skittish investors. But “boiler rooms” are another thing entirely. Typically run out of…
Financial fraud is a serious crime with heavy financial penalties and jail time. Yet people still try to mislead shareholders, bilking investors and destroying companies. Not every financial fraud case ends up on Netflix like biotech entrepreneur and Theranos founder Elizabeth Holmes. But many of the most notorious financial fraud…