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Preface to Second Edition |
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Chapter 1: |
Overview of Federal, State and SRO Securities Enforcement Efforts: Strategies for Responding to Multiple Investigations and Related Actions |
Tyrone C. Fahner ~ Mayer Brown LLP
Robert E. Entwisle ~ Mayer Brown LLP |
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- § 1:1 : Overview1-2
- § 1:2 : SEC Enforcement1-5
- § 1:3 : Self-Regulatory Organizations1-6
- § 1:3.1 : Generally1-6
- § 1:3.2 : FINRA1-7
- § 1:3.3 : PCAOB1-8
- § 1:4 : State Regulation1-9
- § 1:5 : Criminal Prosecution1-10
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Chapter 2: |
Civil Enforcement of Federal Securities Laws--Substantive Violations |
Richard Spehr ~ Mayer Brown Rowe & Maw LLP
Matthew Ingber ~ Mayer Brown LLP |
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- § 2:1 : Introduction: Recent Civil Enforcement2-2
- § 2:2 : SEC Enforcement of Securities Regulations2-5
- § 2:3 : The Securities Act of 19332-5
- § 2:3.1 : Generally2-5
- § 2:3.2 : Section 122-6
- § 2:3.3 : Section 172-7
- § 2:4 : Securities Exchange Act of 19342-8
- § 2:4.1 : Generally2-8
- § 2:4.2 : Section 10(b)2-8
- [A] : Generally2-8
- [B] : Rule 10b-52-10
- § 2:4.3 : Section 13—Reporting Requirements2-11
- § 2:4.4 : Section 14(e)2-14
- § 2:5 : Sarbanes-Oxley Act of 20022-15
- § 2:6 : The Dodd-Frank Act of 20102-16
- § 2:7 : Other Securities Regulations2-16
- § 2:7.1 : Investment Advisers Act of 19402-16
- § 2:7.2 : Investment Company Act of 19402-17
- § 2:7.3 : Insider Trading Sanctions Act of 19842-18
- § 2:7.4 : Insider Trading Securities Fraud Enforcement Act of 19882-18
- § 2:7.5 : Stop Trading on Congressional Knowledge (STOCK) Act of 20122-19
- § 2:7.6 : Recent Insider Trading Cases2-19
- § 2:8 : Extraterritorial Application of U.S. Securities Laws2-21
- § 2:9 : Aiding and Abetting Liability Under the Securities Laws2-24
- § 2:10 : Remedies Available to the SEC2-27
- § 2:10.1 : Judicial Remedies2-28
- § 2:10.2 : Monetary Penalties2-29
- § 2:10.3 : Disgorgement2-29
- § 2:10.4 : Officer and Director Bars2-30
- § 2:10.5 : Cease-and-Desist Orders2-32
- § 2:10.6 : Section 15(c)(4) Orders2-34
- § 2:10.7 : Administrative Fines2-34
- § 2:10.8 : Company Controls2-37
- § 2:10.9 : Bonus Forfeiture2-37
- § 2:11 : Fair Funds2-38
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Chapter 3: |
Criminal Statutes Charged in Securities Cases |
Michael J Gill ~ Mayer Brown LLP
Nicholas D Gill ~ Gragert Research LLC |
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- § 3:1 : Introduction3-1
- § 3:2 : Securities Act and Exchange Act Violations3-3
- § 3:2.1 : Generally3-3
- § 3:2.2 : Section 10(b) and Rule 10b-5 of the Exchange Act3-4
- § 3:2.3 : Section 13 of the Exchange Act3-8
- § 3:2.4 : Sections 5 and 17(a) of the Securities Act3-10
- § 3:3 : Title 18 Violations3-12
- § 3:3.1 : Conspiracy3-12
- § 3:3.2 : Fraud Statutes3-13
- [A] : Mail and Wire Fraud3-13
- [B] : Bank Fraud3-16
- [C] : Sarbanes-Oxley Additions to Fraud Statutes in Title 183-17
- § 3:3.3 : Obstruction of Justice Statutes3-19
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Chapter 4: |
Organizational Sentencing Guidelines |
Lori Lightfoot ~ Mayer Brown LLP |
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- § 4:1 : Important Considerations Regarding “Sentencing” of Business Organizations4-2
- § 4:2 : Organizational Guidelines: A Brief History4-3
- § 4:3 : Guidelines Implications for Securities Law Violations4-7
- § 4:3.1 : Generally4-7
- § 4:3.2 : Restitution4-8
- § 4:3.3 : Fines4-8
- § 4:3.4 : Other Remedial Orders4-10
- § 4:4 : Diminished Impact of Organizational Guidelines4-10
- § 4:4.1 : Impact of Booker on Organizational Guidelines4-10
- § 4:4.2 : Increasing Emphasis on Pre-Charge Negotiations: What Constitutes Cooperation?4-12
- § 4:5 : Rise of Deferred and Non-Prosecution Agreements4-18
- § 4:6 : Conclusion4-21
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Chapter 5: |
The Role of Corporate Internal Investigations |
S Christopher Provenzano ~ Mayer Brown LLP
Lynn A. Neils ~ Covington & Burling LLP
Paula A Tuffin ~ Mayer Brown LLP |
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- § 5:1 : Overview5-3
- § 5:2 : The Constituencies for an Internal Investigation5-4
- § 5:3 : Statutory Provisions Implicating Internal Investigations5-5
- § 5:3.1 : Generally5-5
- § 5:3.2 : The Sarbanes-Oxley Act5-6
- [A] : Generally5-6
- [B] : Duties of the Audit Committee5-6
- [C] : Duties of the Chief Executive Officer and Chief Financial Officer5-7
- [D] : Duties of Lawyers and Auditors5-8
- § 5:3.3 : Duties with Respect to Employees5-10
- § 5:4 : SEC Guidance Relating to Internal Investigations5-11
- § 5:4.1 : The Seaboard Report5-11
- § 5:4.2 : Principles for Imposing Monetary Penalties5-14
- § 5:4.3 : The SEC’s “Cooperation Initiative”5-16
- [A] : Generally5-16
- [B] : Cooperation of Individuals5-16
- [C] : Cooperation Tools5-18
- [D] : Tenaris5-19
- [E] : Carter’s Inc.5-19
- [F] : “Neither Admit or Deny” Settlements5-20
- [G] : Smith & Nephew5-21
- § 5:4.4 : Waiver of Privilege and Work Product Protection5-21
- [A] : Generally5-21
- [B] : Confidentiality Agreements and Collateral Proceedings5-22
- § 5:4.5 : The Benefits of a Strong Internal Investigation5-23
- [A] : Aon Corp.5-23
- [B] : Johnson & Johnson5-25
- [C] : infoUSA Inc.5-26
- [D] : NATCO Group Inc.5-26
- [E] : Daimler AG5-27
- [F] : Foreign Corrupt Practices Act5-28
- [G] : Marubeni Corp.5-28
- § 5:4.6 : Punishment for Inadequate Cooperation5-29
- [A] : Magyar Telekom5-29
- [B] : Alcatel-Lucent5-30
- § 5:5 : Department of Justice Guidance Relating to Internal Investigations5-31
- § 5:5.1 : Generally5-31
- § 5:5.2 : The Filip Memorandum5-32
- § 5:5.3 : Information Relevant to Earning Cooperation Credit5-34
- [A] : Generally5-34
- [B] : “Relevant Facts”5-34
- [C] : “Core” Privileged Information5-37
- § 5:5.4 : Deferred and Non-Prosecution Agreements in Criminal Actions5-38
- [A] : Generally5-38
- [B] : ABN AMRO5-39
- [C] : General Reinsurance Corporation5-41
- [D] : Lloyds TSB Bank plc5-42
- § 5:5.5 : Independent Corporate Monitors5-43
- [A] : Generally5-43
- [B] : Wellcare Health Plans, Inc.5-44
- [C] : Helmerich & Payne5-45
- § 5:5.6 : Federal Sentencing Guidelines5-46
- § 5:6 : FINRA Guidance As It Relates to Internal Investigations5-48
- § 5:6.1 : Generally5-48
- § 5:6.2 : The Benefits of “Extraordinary Cooperation”5-49
- § 5:6.3 : What Is “Extraordinary Cooperation”?5-50
- [A] : Generally5-50
- [B] : Self-Reporting of Violations5-51
- [C] : Extraordinary Steps to Correct Deficient Procedures and Systems5-51
- [D] : Extraordinary Remediation to Customers5-51
- [E] : Providing Substantial Assistance to FINRA Investigations5-52
- § 5:7 : State Investigations and Internal Investigations5-52
- § 5:7.1 : The Martin Act5-53
- § 5:7.2 : Martin Act Investigations5-53
- § 5:8 : Conclusions—The Role of the Internal Investigation5-54
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Chapter 6: |
Conducting Internal Investigations |
Reginald R. Goeke ~ Mayer Brown LLP |
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- § 6:1 : Overview6-2
- § 6:2 : Initiating an Investigation6-3
- § 6:2.1 : Events Triggering an Investigation6-3
- § 6:2.2 : Selecting the Oversight Committee6-5
- § 6:2.3 : Retention of Counsel6-7
- § 6:2.4 : Scope of Investigation6-9
- § 6:2.5 : Document Preservation6-11
- § 6:3 : Gathering Relevant Facts6-13
- § 6:3.1 : Planning Phase6-13
- § 6:3.2 : Data Collection6-14
- § 6:3.3 : Document Review and Organization6-16
- § 6:3.4 : Witness Interviews6-16
- [A] : Timing and Order of Interviews6-16
- [B] : Interview Documents6-17
- [C] : Interviewing Former Employees6-17
- [D] : Witness Warnings6-18
- [D][1] : Upjohn Warning6-18
- [D][2] : Zar Warning6-19
- [D][3] : Separate Counsel Warning6-20
- [E] : Notetaking and Interview Memoranda6-21
- § 6:4 : Managing External Constituents6-22
- § 6:4.1 : Disclosure Requirements6-23
- § 6:4.2 : Auditors6-24
- § 6:4.3 : The Government6-26
- § 6:4.4 : Board Members6-26
- § 6:4.5 : Insurance Carriers6-27
- § 6:5 : Presenting the Investigation’s Findings6-28
- § 6:5.1 : Forms of Reports6-28
- § 6:5.2 : Contents of a Written Report6-30
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Chapter 7: |
Attorney-Client and Work Product Considerations in Internal Investigations |
William Michael, Jr. ~ Mayer Brown LLP
Natalie K Kissinger ~ Mayer Brown LLP |
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- § 7:1 : Overview7-2
- § 7:2 : The Attorney-Client Privilege7-2
- § 7:2.1 : Elements Generally7-2
- § 7:2.2 : Application to Internal Investigations7-6
- § 7:3 : The Work Product Doctrine7-7
- § 7:3.1 : Elements Generally7-7
- § 7:3.2 : Application to Internal Investigations7-9
- § 7:4 : Self-Evaluative Privilege7-10
- § 7:5 : Safeguarding the Attorney-Client Privilege and Work Product Protection During Internal Investigations—Specific Applications7-11
- § 7:5.1 : Investigation by Independent Counsel7-11
- § 7:5.2 : Employee Interviews7-12
- § 7:5.3 : Former Employee Interviews7-16
- § 7:6 : Waiver and Exceptions: General Principles7-16
- § 7:6.1 : Waiver of Attorney-Client Privilege7-16
- § 7:6.2 : Waiver of Work Product Material7-17
- § 7:6.3 : “Crime-Fraud” Exception to Privilege7-18
- § 7:6.4 : Extent of Waiver7-19
- [A] : Partial Waiver7-19
- [B] : Successors in Interest7-19
- § 7:6.5 : Corporate Clients and Authority to Waive7-20
- § 7:6.6 : Waiver Issues Concerning Investigative Reports7-22
- § 7:7 : Intentional Selective Waiver of the Attorney-Client Privilege and Work Product Protection7-24
- § 7:7.1 : Selective Waiver of Attorney-Client Privilege7-24
- § 7:7.2 : Selective Waiver of Work Product Protection7-26
- § 7:8 : Federal Rule of Evidence 5027-28
- § 7:9 : Cooperation with Government Investigations and Disclosure of Protected Material7-33
- § 7:9.1 : Background: Government Requests for Privilege Waivers7-33
- § 7:9.2 : Recommendations7-35
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Chapter 8: |
Defending Federal Grand Jury Investigations |
Vincent J Connelly ~ Mayer Brown LLP
Thomas M Durkin ~ Mayer Brown Rowe & Maw LLP |
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- § 8:1 : The Role of the Grand Jury8-2
- § 8:2 : The Role of the Prosecutor8-3
- § 8:3 : Constitutional and Statutory Authority and Guidelines8-4
- § 8:4 : Composition of the Grand Jury8-4
- § 8:4.1 : Generally8-4
- § 8:4.2 : Qualifications8-5
- § 8:4.3 : Challenges to the Grand Jury8-5
- § 8:5 : The Grand Jury’s Term8-6
- § 8:6 : The Participants8-6
- § 8:7 : Secrecy Requirement8-7
- § 8:8 : Powers and Limitations8-9
- § 8:8.1 : Generally8-9
- § 8:8.2 : The Grand Jury Subpoena8-9
- § 8:8.3 : Issuing Subpoenas8-9
- § 8:8.4 : Service of the Grand Jury Subpoena8-10
- § 8:8.5 : Limitations on the Use of the Subpoena Power8-11
- § 8:8.6 : Evidentiary Rules8-12
- § 8:9 : Returning an Indictment8-12
- § 8:10 : Handling the Investigation8-13
- § 8:10.1 : Determining Governmental Interest8-13
- § 8:10.2 : Invoking the Privilege Against Self-Incrimination8-14
- [A] : Generally8-14
- [B] : Incriminating Testimony8-16
- [C] : Incriminating Documents8-17
- [D] : Privilege Does Not Apply to Corporations8-18
- § 8:10.3 : Immunity8-18
- [A] : Generally8-18
- [B] : Advantages of Immunity8-19
- § 8:11 : Responding to a Subpoena for Documents8-20
- § 8:11.1 : Generally8-20
- § 8:11.2 : The Document Hold Memo8-20
- § 8:11.3 : The Scope of the Subpoena8-21
- [A] : Generally8-21
- [B] : Negotiating with the Prosecution8-21
- [C] : Motion to Quash8-21
- § 8:11.4 : Records Witness8-22
- § 8:11.5 : Reviewing the Documents8-22
- § 8:12 : Responding to a Subpoena for Testimony8-23
- § 8:12.1 : Preparation8-23
- § 8:12.2 : Advice to the Witness8-24
- § 8:12.3 : Testifying8-24
- [A] : Generally8-24
- [B] : Advice of Rights8-25
- § 8:12.4 : Debriefing8-25
- § 8:12.5 : Aftermath8-26
- § 8:13 : Conclusion8-27
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Chapter 9: |
Defending an SEC Investigation |
Reginald R. Goeke ~ Mayer Brown LLP |
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- § 9:1 : Overview of an SEC Investigation9-2
- § 9:2 : Initial Stages of an Investigation9-4
- § 9:2.1 : Early Contacts with Enforcement Division9-4
- § 9:2.2 : The Decision Whether to Cooperate9-8
- § 9:2.3 : Public Disclosure and Trading Restrictions9-12
- § 9:3 : Document Production and Testimony9-13
- § 9:3.1 : Staff Requests for Documents and Other Records9-13
- § 9:3.2 : Interaction with Other Counsel9-17
- § 9:3.3 : Preparation for Investigative Testimony9-17
- § 9:3.4 : Conduct of Investigative Testimony9-18
- § 9:3.5 : Subpoena Enforcement9-22
- § 9:3.6 : Ongoing Attention to the Cooperation and Seaboard Process9-22
- § 9:3.7 : Foreign Assistance9-23
- § 9:4 : The Wells Process and Possible Settlement9-23
- § 9:4.1 : The Staff’s Wells Notice9-23
- § 9:4.2 : The Wells Submission9-25
- § 9:4.3 : Settlement Discussions9-26
- § 9:5 : Transitioning to Litigation9-31
- § 9:5.1 : Civil Actions in U.S. District Court9-31
- § 9:5.2 : SEC Administrative Proceedings9-32
- § 9:6 : Conclusion9-35
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Chapter 10: |
Cooperation in SEC and DOJ Cases |
Joseph De Simone ~ Mayer Brown Rowe & Maw LLP
James Ancone ~ Mayer Brown LLP |
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- § 10:1 : Overview10-2
- § 10:2 : Cooperating with the SEC: Lessons from the Years Since the Seaboard Report10-4
- § 10:2.1 : Generally10-4
- § 10:2.2 : Selected SEC Enforcement Actions After Seaboard10-9
- [A] : Generally10-9
- [B] : Xerox10-10
- [C] : Dynegy10-10
- [D] : Homestore10-11
- [E] : Lucent Technologies10-12
- [F] : Banc of America Securities LLC10-13
- [G] : Gemstar-TV Guide International, Inc.10-14
- [H] : Royal Ahold10-15
- [I] : Putnam Fiduciary Trust Company10-15
- [J] : American International Group (AIG)10-16
- [K] : KLA-Tencor Corporation10-17
- [L] : Aspen Technology, Inc.10-18
- [M] : General Reinsurance Corporation10-18
- [N] : State Street Bank and Trust Company10-19
- [O] : Carter’s10-20
- [P] : Tenaris10-21
- [Q] : Fannie Mae and Freddie Mac10-22
- § 10:2.3 : Summary of Lessons Learned and Guidance Going Forward10-23
- § 10:3 : Cooperating with the Department of Justice: Lessons from the Years Since the Thompson Memorandum10-25
- § 10:3.1 : Generally10-25
- § 10:3.2 : Selected Enforcement Actions Since the Release of the Thompson, McNulty, and Filip Memoranda10-28
- [A] : Generally10-28
- [B] : Agreements Governed by the Thompson Memorandum10-29
- [B][1] : Banco Popular de Puerto Rico10-29
- [B][2] : Bank of New York10-30
- [B][3] : Symbol Technologies, Inc.10-30
- [B][4] : Bristol-Myers Squibb10-31
- [B][5] : Computer Associates10-32
- [B][6] : Riggs Bank10-33
- [C] : Agreements Governed by the McNulty Memorandum10-35
- [C][1] : El Paso Corporation10-35
- [C][2] : Baker Hughes10-36
- [D] : Agreements Governed by the Filip Memorandum10-37
- [D][1] : Fiat S.p.A.10-37
- [D][2] : UBS AG10-38
- [D][3] : General Reinsurance Corporation10-39
- [D][4] : Wachovia Bank, N.A.10-40
- [D][5] : Tyson Foods, Inc.10-41
- [D][6] : Biomet10-42
- § 10:3.3 : Summary of Lessons Learned and Guidance Going Forward10-43
- § 10:4 : Conclusion10-46
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Chapter 11: |
The SEC's Office of Compliance Inspections and Examinations |
Stephanie M. Monaco ~ Mayer Brown LLP
Adam D Kanter ~ Mayer Brown LLP |
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- § 11:1 : Overview11-2
- § 11:1.1 : Authority11-2
- § 11:1.2 : Organization11-4
- [A] : Broker/Dealer Group11-5
- [B] : Investment Adviser/Investment Company Group11-5
- [C] : Market/SRO Oversight Group11-5
- [D] : Office of Chief Counsel11-5
- [E] : Risk Analysis and Surveillance Unit11-6
- [F] : Specialization Working Groups11-6
- [G] : Steering Committees11-7
- § 11:2 : Overview of Examinations11-7
- § 11:2.1 : Types of Exams11-8
- [A] : Risk-Targeted (“Sweep”) Exams11-8
- [B] : For-Cause Exams11-8
- [C] : Routine Exams11-9
- [D] : Oversight Exams11-10
- § 11:2.2 : Process11-10
- [A] : Before the Visit11-10
- [B] : On-Site Visit11-12
- [C] : Exit Interviews/Closure Notification11-12
- [D] : Post-Examination11-13
- § 11:3 : Strategies for a Successful Examination11-14
- § 11:3.1 : Pre-Exam Communications11-14
- § 11:3.2 : The Examination11-14
- § 11:3.3 : Document Production and Requests for Extensions11-16
- § 11:4 : Keeping Abreast of Current Trends11-17
- § 11:4.1 : Common Deficiencies in Compliance Programs11-17
- § 11:4.2 : Changes in OCIE Examination Practices11-18
- § 11:4.3 : Compliance Trends by Category of Registrant11-19
- [A] : Broker-Dealers11-19
- [B] : Investment Advisers/Investment Companies11-20
- § 11:5 : Conclusion11-22
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Chapter 12: |
FINRA Investigations |
Jerome J. Roche ~ Mayer Brown LLP
Brad Resnikoff ~ Mayer Brown LLP |
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- § 12:1 : Introduction12-2
- § 12:2 : FINRA Background12-3
- § 12:3 : Violations of FINRA and NASD Rules12-6
- § 12:3.1 : Generally12-6
- § 12:3.2 : Investigation of Violations12-7
- [A] : Office of Fraud Detection and Market Intelligence12-7
- [B] : Examinations As Sources of Investigation12-8
- [B][1] : Generally12-8
- [B][2] : Routine Examinations12-9
- [B][3] : For-Cause Examinations12-10
- [B][4] : Market Regulation Examinations12-10
- [B][5] : Potential Examination of Investment Advisers12-10
- [C] : Sweeps12-12
- [D] : Referrals As Sources of Investigations12-13
- [E] : Insider Trading Investigations12-14
- [F] : Investigative Powers of FINRA12-15
- [F][1] : Use of FINRA Rule 8210 to Obtain Documents and Testimony12-15
- [F][2] : “On the Record” Testimony12-17
- [G] : Wells Submissions12-17
- § 12:3.3 : Disciplinary Proceedings12-18
- [A] : Generally12-18
- [B] : Sanctions and Penalties for Violations12-20
- [C] : Cooperation12-21
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Chapter 13: |
Cross-Border Regulation of the Financial Markets; And Appendix 13A: Cooperative Arrangements Between the SEC and Foreign Regulators |
Mark G. Hanchet ~ Mayer Brown LLP
Angela Hayes ~ Mayer Brown LLP |
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- § 13:1 : Overview13-2
- § 13:2 : The SEC—U.S. Cross-Border Securities Regulation and Enforcement13-3
- § 13:2.1 : Generally13-3
- § 13:2.2 : Cross-Border Cooperation and Domestic Law13-4
- § 13:2.3 : Formal Mechanisms of Cooperation13-6
- [A] : Multilateral Organizations13-6
- [B] : Bilateral Arrangements13-9
- [B][1] : Memoranda of Understanding13-9
- [B][2] : Bilateral Dialogues13-12
- § 13:2.4 : Informal Mechanisms of Cooperation13-13
- § 13:2.5 : Cross-Border Enforcement Issues13-13
- [A] : Obtaining Testimony and Evidence13-13
- [B] : Cross-Border Enforcement Cooperation, by the Numbers13-14
- § 13:2.6 : Enforcement Issues13-15
- [A] : Insider Trading13-15
- [B] : Securities Fraud13-16
- [C] : Market Manipulation13-17
- [D] : FCPA13-18
- § 13:2.7 : Cross-Border Regulatory Cooperation13-19
- § 13:2.8 : Obstacles to Cross-Border Securities Regulation13-19
- § 13:3 : U.K. Financial Services Authority—An EU Regulator’s Approach to Cross-Border Regulation13-22
- § 13:3.1 : Background and Approach to Regulation13-22
- § 13:3.2 : Enforcement Policy, Powers, and Procedures13-23
- [A] : Authority to Investigate and Prosecute13-23
- [B] : Investigative and Enforcement Process13-25
- § 13:3.3 : Cross-Border Cooperation in Investigations and Enforcement13-26
- [A] : Methods of Cross-Border Cooperation13-26
- [B] : FSA v. Amro International SA and Creon Management SA13-28
- § 13:3.4 : Restrictions on Cooperation—Confidentiality of Information Provided to the FSA and Legal Privilege13-30
- § 13:4 : Looking Ahead and Conclusion13-31
- Appendix 13A : Cooperative Arrangements Between the SEC and Foreign RegulatorsApp. 13A-1
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Chapter 14: |
Enforcement of the Foreign Corrupt Practices Act and Other Anti-Bribery Law |
William Michael, Jr. ~ Mayer Brown LLP
Sean P. McDonnell ~ Mayer Brown LLP |
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- § 14:1 : Overview14-2
- § 14:2 : Legal Elements14-4
- § 14:2.1 : Anti-Bribery and Accounting Provisions14-4
- [A] : Anti-Bribery Provisions14-4
- [B] : Accounting Provisions14-4
- § 14:2.2 : Jurisdiction Pursuant to the FCPA14-5
- [A] : Anti-Bribery14-5
- [A][1] : Issuers14-5
- [A][2] : Domestic Concerns14-6
- [A][3] : Persons Other Than Issuers or Domestic Concerns14-6
- [B] : Scope of the Term “Foreign Officials”14-7
- § 14:2.3 : Facilitation Payments14-9
- § 14:2.4 : Affirmative Defenses14-10
- § 14:2.5 : Statute of Limitations14-11
- § 14:2.6 : DOJ Opinion Process14-11
- § 14:2.7 : Penalties14-12
- § 14:2.8 : Consultants, Agents, and Other Third-Party Intermediaries: Managing the Risks of Liability for the Conduct of Others14-13
- § 14:3 : Mergers & Acquisitions14-16
- § 14:4 : Recent FCPA Enforcement Activity and Developments14-16
- § 14:4.1 : New Whistleblower Rules Under the Dodd-Frank Act14-16
- § 14:4.2 : Review of Recent Enforcement Actions14-18
- [A] : Generally14-18
- [B] : Recent Cases Brought by the DOJ and the SEC14-18
- [B][1] : Siemens AG14-18
- [B][2] : BAE Systems PLC14-19
- [B][3] : KBR, Inc. and Halliburton Co.14-20
- [B][4] : Marubeni Corporation14-21
- [B][5] : Panalpina14-22
- [B][6] : Johnson & Johnson14-23
- [B][7] : BizJet International Sales and Support Inc.14-24
- [B][8] : Tenaris, S.A.14-25
- [B][9] : The Gabon “Sting” Prosecutions14-26
- [C] : Recent SEC Enforcement Actions Taken Without the DOJ14-27
- [C][1] : Asia14-27
- [C][2] : South America14-28
- [C][3] : Africa/Middle East14-29
- § 14:4.3 : Trends14-29
- [A] : Voluntary Disclosures14-29
- [B] : Global Cooperation and Enforcement14-31
- [C] : Individual Liability14-33
- [D] : Control Person Liability14-34
- [E] : Industry-Wide Investigations14-35
- § 14:5 : Overview of FCPA Compliance Practice14-36
- § 14:5.1 : Generally14-36
- § 14:5.2 : Sources of Guidance14-36
- § 14:6 : Conclusion14-40
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Chapter 15: |
Dealing with Parallel Actions |
Christopher J Houpt ~ Mayer Brown LLP |
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- § 15:1 : Introduction: Types of Parallel Actions15-2
- § 15:2 : Statutes of Limitations15-5
- § 15:3 : Use of Information Across Proceedings15-7
- § 15:3.1 : Disclosure of DOJ Involvement15-7
- § 15:3.2 : Discovery15-7
- § 15:3.3 : Sharing of SEC Investigative Material15-8
- § 15:3.4 : Access to SEC Files and FOIA Requests15-9
- § 15:3.5 : Grand Jury Secrecy and Criminal Procedure Rule 6(e)(3)15-11
- § 15:3.6 : Remedies for Government Misconduct15-12
- § 15:4 : Waiver of Privilege15-14
- § 15:4.1 : Generally15-14
- § 15:4.2 : Waiver Demands by the SEC and DOJ15-14
- § 15:4.3 : Potential Waiver Assertions by Defendants—SEC v. Gupta15-17
- § 15:4.4 : Recent Developments Narrowing the Use of Waiver15-18
- [A] : The Legislative Response—The Financial Services Regulatory Relief Act and the Proposed Attorney-Client Privilege Protection Act15-18
- [B] : The DOJ’s Revised Approach—The McNulty Memo15-19
- [C] : The SEC15-20
- § 15:5 : Fifth Amendment Considerations15-21
- § 15:6 : Stays of Parallel Proceedings15-22
- § 15:7 : Proceedings to Block Agency Actions—Gupta v. SEC15-25
- § 15:8 : Effects on Later Proceedings15-27
- § 15:8.1 : Disclosure of Evidence at Trial15-27
- § 15:8.2 : Settlement Agreements15-27
- § 15:8.3 : Disclosure of Facts Underlying SEC Settlements15-28
- § 15:8.4 : Collateral Estoppel15-30
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Chapter 16: |
Representing Individuals in Securities Investigations |
Kelly B. Kramer ~ Mayer Brown LLP
Justin A. McCarty ~ Mayer Brown LLP |
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- § 16:1 : Overview16-3
- § 16:2 : Types of Investigations16-3
- § 16:2.1 : Generally16-3
- § 16:2.2 : SEC Investigations16-4
- [A] : Generally16-4
- [B] : Matters Under Inquiry16-4
- [C] : Informal Investigations16-5
- [D] : Formal Investigations16-6
- § 16:2.3 : Criminal Investigations16-7
- § 16:2.4 : Corporate Internal Investigations16-8
- § 16:3 : Status of the Individual16-9
- § 16:3.1 : Generally16-9
- § 16:3.2 : Determining the SEC’s Perspective16-10
- § 16:3.3 : Is There a Parallel Criminal Investigation?16-11
- [A] : Generally16-11
- [B] : “Subjects” and “Targets”16-12
- [C] : “Non-Subject” Letters16-13
- § 16:3.4 : Interacting with Other Private Counsel16-13
- [A] : Generally16-13
- [B] : Counsel for the Corporation16-14
- [C] : Counsel for Other Individuals16-17
- [D] : Joint Defense Agreements16-18
- § 16:4 : Investigation16-19
- § 16:4.1 : Generally16-19
- § 16:4.2 : Client Interviews16-19
- § 16:4.3 : Witness Interviews16-21
- § 16:4.4 : Document Review16-22
- § 16:4.5 : Precedent Sources16-22
- § 16:5 : Process Violations16-22
- § 16:5.1 : Generally16-22
- § 16:5.2 : False Statements and Perjury16-23
- § 16:5.3 : Obstruction of Justice16-24
- § 16:5.4 : Zar Warnings16-25
- § 16:5.5 : Reporting Obligations Under SEC Professional Conduct Rules16-26
- § 16:6 : Production of Documents16-27
- § 16:6.1 : Document Preservation16-27
- [A] : Maintain Record of Legal Advice16-27
- [B] : Maintain Record of All Steps Taken16-27
- [C] : Third Parties16-27
- § 16:6.2 : Personal Versus Corporate Records16-28
- § 16:6.3 : Objections to Subpoenas16-29
- § 16:6.4 : Doe Immunity16-31
- § 16:6.5 : Preserving the Confidentiality of Documents Produced to the Government16-32
- [A] : Generally16-32
- [B] : Grand Jury Proceedings16-32
- [C] : SEC Enforcement Investigations16-33
- § 16:7 : Testimony16-35
- § 16:7.1 : Generally16-35
- § 16:7.2 : Right to Representation16-35
- § 16:7.3 : Privileges16-37
- [A] : Generally16-37
- [B] : Fifth Amendment16-37
- [C] : Attorney-Client16-40
- § 16:7.4 : Immunity16-41
- § 16:7.5 : Use Immunity: “Queen for a Day”16-42
- § 16:7.6 : Obtaining the Transcript16-43
- § 16:8 : Cooperation16-44
- § 16:8.1 : Generally16-44
- § 16:8.2 : Corporate-Government Cooperation: Employee Beware16-44
- § 16:8.3 : Types of Cooperation16-47
- § 16:8.4 : Securing Cooperation Benefits16-48
- § 16:9 : Legal Fees16-50
- § 16:9.1 : Indemnification and Advancement of Fees16-50
- § 16:9.2 : Insurance Coverage16-51
- § 16:10 : Charging Your Client16-52
- § 16:10.1 : Indictment16-53
- § 16:10.2 : The Wells Process16-54
- § 16:10.3 : Settling with the SEC16-56
- § 16:11 : Available Sanctions Against Individuals16-58
- § 16:11.1 : Cease-and-Desist Orders16-58
- § 16:11.2 : Financial Remedies: Disgorgement and Fines16-58
- [A] : Disgorgement16-59
- [B] : Fines16-59
- § 16:11.3 : Director and Officer Bars16-61
- § 16:11.4 : Criminal Penalties16-61
- [A] : Imprisonment16-61
- [B] : Financial Sanctions16-62
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Chapter 17: |
Communicating with the Company's Auditor in a Securities Investigation |
Brian J. Massengill ~ Mayer Brown LLP
Mark D Manela ~ Mayer Brown LLP |
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- § 17:1 : Introduction17-2
- § 17:2 : Reasons for Disclosures to the Company’s Auditor17-3
- § 17:2.1 : Management Representations in the Audit Process17-3
- § 17:2.2 : Investigations Initiated by the Company’s Auditor17-5
- § 17:2.3 : Obtaining Information and Assistance from the Auditor17-7
- § 17:3 : Work Product Protection and Waiver17-7
- § 17:3.1 : Generally17-7
- § 17:3.2 : The Minority View: Waiver by Disclosure to the Company’s Auditor: The Medinol Case17-8
- § 17:3.3 : The Majority View of No Waiver17-11
- [A] : The Merrill Lynch Case17-11
- [B] : Cases Following Merrill Lynch17-13
- [C] : The Deloitte Case Finds No Waiver17-14
- § 17:4 : Waiver of Attorney-Client Privilege17-17
- § 17:5 : Practical Precautions to Protect Against Waiver17-18
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Chapter 18: |
Employment Issues in Securities Investigations |
Marcia E Goodman ~ Mayer Brown LLP
Courtney L Anderson ~ Mayer Brown LLP |
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- § 18:1 : Overview18-2
- § 18:2 : Investigative Techniques in the Workplace18-3
- § 18:2.1 : Generally18-3
- § 18:2.2 : Monitoring Employees’ Use of Computers, Phones, and Email18-3
- [A] : Generally18-3
- [B] : Electronic Communications Privacy Act18-4
- [B][1] : Generally18-4
- [B][2] : The Consent Exception18-6
- [B][3] : Business Extension Exception18-7
- [B][4] : The Service Provider Exception18-9
- [C] : State Statutory Considerations18-9
- [D] : State Common Law Invasion of Privacy Claims18-10
- [E] : Practical Tips for Employers Relating to Electronic Monitoring18-14
- § 18:2.3 : Video Surveillance18-15
- § 18:2.4 : Polygraph Tests18-18
- § 18:2.5 : The Use of Pretext18-19
- § 18:3 : The Effect of the Fair Credit Reporting Act Upon Workplace Investigations18-20
- § 18:3.1 : Generally18-20
- § 18:3.2 : Consumer Report Versus Investigative Consumer Report18-21
- § 18:3.3 : FACTA Investigations18-21
- § 18:3.4 : Non-FACTA Investigations18-22
- § 18:3.5 : Adverse Action Procedures18-22
- § 18:3.6 : Employers’ Certifications to Consumer Reporting Agencies18-23
- § 18:3.7 : Risks of Noncompliance18-23
- § 18:4 : The Employee’s Duty to Cooperate18-23
- § 18:4.1 : Generally18-23
- § 18:4.2 : The Government’s Perspective on Cooperation18-24
- § 18:4.3 : Representation of the Employee18-25
- § 18:4.4 : Employee Representation Rights18-27
- [A] : Weingarten Rights18-27
- [B] : Investigative Interviews in the Non-Union Workplace18-27
- § 18:5 : Indemnification and Advancement of Attorneys’ Fees During an Investigation18-29
- § 18:5.1 : Generally18-29
- § 18:5.2 : As Set Forth by the Documents Concerning Corporate Governance18-29
- § 18:5.3 : As Set Forth by State Statutes18-30
- § 18:5.4 : As Potentially Limited by SOX18-32
- § 18:5.5 : Prosecutorial Considerations18-34
- § 18:6 : Termination or Suspension of Employees for Wrongdoing18-36
- § 18:7 : Protection of Whistleblowers from Retaliation18-38
- § 18:7.1 : Whistleblower Protection Under the Sarbanes-Oxley Act18-38
- § 18:7.2 : Covered Employers18-39
- § 18:7.3 : Covered Employees18-41
- [A] : Employees Based Outside of the United States18-42
- [B] : Independent Contractors18-43
- [C] : Security Analysts18-44
- § 18:7.4 : Protected Activity18-44
- § 18:7.5 : Remedies18-46
- § 18:7.6 : Individual Liability18-48
- § 18:7.7 : Whistleblower Protection Under the Dodd-Frank Act18-48
- § 18:7.8 : Compliance Programs18-53
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Chapter 19: |
Appendix A: The Thompson Memorandum |
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Chapter 20: |
Appendix B: The McNulty Memorandum |
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Chapter 21: |
Appendix C1: Remarks by Deputy Attorney General--Revisions to Corporate Charging Guidelines |
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Chapter 22: |
Appendix C2: Press Release--Revisions to Corporate Charging Guidelines |
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Chapter 23: |
Appendix C3: Department of Justice Corporate Charging Guidelines |
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Chapter 24: |
Appendix D: The Seaboard Report |
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Chapter 25: |
Appendix E: Recommended Practices |
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Chapter 26: |
Table of Authorities |
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Chapter 27: |
Index to Securities Investigations |
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