Ford O'Brien, LLP

New York Securities Law Blog

FINRA sanctions target unauthorized solicitation of cryptocurrency investments

A former broker was recently sanctioned by the Financial Industry Regulatory Authority (FINRA) for allegedly engaging in outside cryptocurrency business activities. According to FINRA, the ex-Wells Fargo broker attempted to start a cryptocurrency company without first disclosing his intent and obtaining approval from Wells Fargo. FINRA further claimed that the broker provided false information to Wells Fargo to try to conceal his outside activity.

Specifically, the broker was accused of violating FINRA Rules 3270 (which governs outside business activities), 3280 (which governs private securities transactions) and 2010 (which governs standards of commercial honor and principles of trade).

Former Refco CEO granted compassionate release from prison

Phillip Bennett, former CEO of Refco Inc., has won compassionate release from prison and is expected to be deported to the U.K. in the near future.

His release comes amid concerns about the spread of COVID-19 in U.S. prisons. In his request for early release, Bennett said his age (71), high blood pressure and high cholesterol raise the risk of his contracting the virus while incarcerated.

11 Class Actions Claim Crypto-Asset Exchanges Violated Securities Laws

Enthusiasm for Bitcoin has factored largely in many decisions to invest in the cryptocurrency market.

But according to 11 class actions filed on April 3 in the Southern District of New York, four crypto-asset exchanges and seven digital token issuers took advantage of that enthusiasm by unlawfully issuing and selling billions of dollars of unregistered digital tokens.

The lawsuits claim that the issuers and exchanges failed to comply with state and federal securities laws.

Recent trends in FINRA disciplinary actions

As you may know, the Financial Industry Regulatory Authority (FINRA) is a self-regulating association that conducts investigations into its members with regard to securities law compliance. FINRA oversees disciplinary actions for its broker-dealer members who violate FINRA rules or SEC regulations. 

SEC wins injunction against Telegram's new cryptocurrency

In a landmark digital currency ruling, a US District Judge in Manhattan has issued a preliminary injunction against Telegram. The Securities and Exchange Commission (SEC) initiated the lawsuit against Telegram in an attempt to bar the launch of the Company's Open Network blockchain. The judge maintained the SEC's claims that Telegram's initiative to produce a new digital currency for its TON platform involved the sale of unregistered securities.

COVID-19 Update: Ford O'Brien is open for business. Please contact us to discuss your options.

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How can I reduce the severity of FINRA disciplinary actions?

A Financial Industry Regulatory Authority (FINRA) investigation under Rule 8210 isn’t something to panic about. Nor is it something to take lightly. Depending on the regulatory agency’s findings, yourself or your firm may face severe penalties. That can include a temporary or permanent ban from the industry or monetary fines.

There is an opportunity to help lighten the discipline, however.

Former congressman charged with securities fraud pleads guilty

Former New York congressman Chris Collins has resigned after a long fight with the Securities Exchange Commission over insider trading charges.

Mr. Collins was expected to be tried in February, along with his son, Cameron Collins, and another man named Stephen Zarsky. All of them plead not guilty at the time. However, circumstances changed on Oct. 1 when Collins plead guilty for conspiracy to commit securities fraud and lying to federal investigators.

3 Signs Your Company Is The Target Of A Phishing Scheme

Your company’s computers are a treasure trove of valuable information. You try to protect employee, customer and business data from fraud and thievery every day.

One thing you protect your information from is phishing. Phishers can use email to target information like yours. If they get their hands on it, they’ll use that information for their personal gain.

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