The U.S. Securities and Exchange Commission
("SEC") recently reaffirmed its
determination to hold those involved in market abuse violations
accountable. To illustrate, the following three charges are
On 10 February 2012, the SEC announced that it was charging yet
another person in the Galleon insider trading case involving Raj
Rajaratnam. Numerous defendants have been charged in the Galleon
insider trading case to date. This time it concerned a managing
member of hedge fund investment adviser Whitman Capital LLP and his
firm for violating insider trading prohibitions. Allegedly, Whitman
traded in the listed securities based on non-public information
which he received from a former employee of the Galleon Group hedge
A second insider trading case involves unlawful trading by a
former vice-president of Coca Cola. On 8 March 2012, the SEC filed
a charge in which it claimed that the former VP allegedly used
non-public information about an imminent acquisition by the company
to purchase securities of Coco Cola Enterprises on the day before
the acquisition. According to the SEC the former VP misappropriated
the material non-public information, whereas he had a relationship
of trust and confidence with the company, was regularly in
possession of sensitive and confidential information and also
signed a non-disclosure agreement confirming that he would maintain
Another example of the SEC's focus on market abuse
violations is the charge against BankAtlantic Bancorp and its CEO
on 18 January 2012. The charges inter alia include accounting fraud
and misleading investors about BankAtlantic Bancorp's real
estate portfolio at the time that the real estate market
floundered. According to the SEC, Bancorp presented misleading
information on earning calls in 2007 to conceal losses in its real
estate portfolio. Furthermore, BankAtlantic Bancorp allegedly filed
incorrect reporting statements.
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SCOTUS upheld the constitutionality of state statutes providing criminal penalties for the refusal to provide a breath test after an arrest for DUI, but held them unconstitutional when applied to blood tests.
In a recent decision, Judge Laura Taylor Swain of the U.S. District Court for the Southern District of New York held that J.P. Morgan Chase & Co.'s (JPMorgan) disclosure of information to FINRA in response to a routine chronology/name recognition inquiry constituted a waiver of privilege in a subsequent criminal insider trading case.
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