Mobile TeleSystems Settles FCPA Violations

Russian telecommunications provider Mobile TeleSystems PJSC (MTS) will pay $100 million to resolve SEC charges that it violated the Foreign Corrupt Practices Act (FCPA) to win business in Uzbekistan.

According to the SEC’s order, MTS bribed an Uzbek official who was related to the former President of Uzbekistan and had influence over the Uzbek telecommunications regulatory authority. During the course of the scheme, MTS made at least $420 million in illicit payments for the purpose of obtaining and retaining business. The payments enabled MTS to enter the telecommunications market in Uzbekistan and operate there for eight years, during which it generated more than $2.4 billion in revenues. In 2012, the Uzbek government expropriated MTS’s Uzbek operations. As further described in the SEC’s order, the bribes were funneled to front companies controlled by the Uzbek official and were disguised in MTS’s books as acquisition costs, option payments, purchases of regulatory assets, and charitable donations.

“The company engaged in egregious misconduct for nearly a decade, secretly funneling hundreds of millions of dollars to a corrupt official. Building business on a foundation of bribery leaves the business and American investor interests at the mercy of corrupt officials,” said Charles E. Cain, Chief of the SEC Enforcement Division’s FCPA Unit.

Read the full article from the SEC here.

—The attorneys at Sallah Astarita & Cox include veteran securities litigators and former SEC Enforcement Attorneys. We have decades of experience in securities litigation matters, including the defense of enforcement actions. We represent investors, financial professionals and investment firms, nationwide. For more information call 212-509-6544 or send an email to mja@sallahlaw.com.

from SECLaw.com

SEC Charges Registered Investment Adviser and Former Chief Operating Officer With Defrauding Client

The Securities and Exchange Commission today charged Talimco LLC, a registered investment adviser, and Grant Gardner Rogers, the former chief operating officer of the firm, with manipulating the auction of a commercial real estate asset on behalf of one client for the benefit of another.   

According to the SEC’s order, in or about April 2015 while selling a commercial real estate asset on behalf of a collateralized debt obligation client, Talimco and Rogers were aiming to acquire the asset for another client, a private fund.  Talimco and Rogers owed its selling client a fiduciary duty, which included an obligation to take steps to use its best efforts to maximize the price obtained for the asset by identifying willing bidders.  However, rather than seek out multiple bona fide bidders, the order finds that Rogers used the firm’s affiliated private fund client for one bid and convinced two unwilling bidders to participate in the auction by giving assurances that the bidders would not win the auction.  As a result of this manipulation, Talimco’s private fund client was the highest bidder and acquired the asset, only to then later sell it for a substantial profit.  Talimco and Rogers’s conduct deprived the selling client of the opportunity to obtain multiple bona fide bids for the asset and maximize their profit.  

“By rigging the auction, Talimco and Rogers failed to fulfill their fiduciary duty to their client,” said Daniel Michael, Chief of the SEC Enforcement Division’s Complex Financial Instruments Unit.  “Investment adviser firms are expected to have controls in place to detect and disclose conflicts of interest.  This action evidences the vigilance of the SEC’s exam and enforcement staff in identifying investments advisers that exploit client relationships and harm investors.”

The settled orders find that Talimco and Rogers violated Section 206(2) of the Investment Advisers Act.  Without admitting or denying the findings in the order, Talimco consented to a cease-and-desist order, a censure, disgorgement of its fees of $74,000 plus prejudgment interest of $8,758.80 and a penalty of $325,000.  Rogers, who also did not admit nor deny the findings, consented to a cease-and-desist order, a 12-month industry suspension, and a $65,000 fine.

The SEC’s investigation was conducted by Philip A. Fortino, Sharon Bryant, and Osman Nawaz of the Complex Financial Instruments Unit and Haimavathi Marlier and Thomas P. Smith Jr. of the New York Regional Office, and was supervised by Mr. Michael and Lara S. Mehraban.  An examination that led to the investigation was conducted by the Private Funds Unit. 

SEC Press Release

— If you believe need help with a securities litigation, arbitration or litigation issue, email Mark Astarita or call 212-509-6544 to speak to a securities lawyer.

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SEC Charges Registered Investment Adviser and Former Chief Operating Officer With Defrauding Client

The Securities and Exchange Commission today charged Talimco LLC, a registered investment adviser, and Grant Gardner Rogers, the former chief operating officer of the firm, with manipulating the auction of a commercial real estate asset on behalf of one client for the benefit of another.   

According to the SEC’s order, in or about April 2015 while selling a commercial real estate asset on behalf of a collateralized debt obligation client, Talimco and Rogers were aiming to acquire the asset for another client, a private fund.  Talimco and Rogers owed its selling client a fiduciary duty, which included an obligation to take steps to use its best efforts to maximize the price obtained for the asset by identifying willing bidders.  However, rather than seek out multiple bona fide bidders, the order finds that Rogers used the firm’s affiliated private fund client for one bid and convinced two unwilling bidders to participate in the auction by giving assurances that the bidders would not win the auction.  As a result of this manipulation, Talimco’s private fund client was the highest bidder and acquired the asset, only to then later sell it for a substantial profit.  Talimco and Rogers’s conduct deprived the selling client of the opportunity to obtain multiple bona fide bids for the asset and maximize their profit.  

“By rigging the auction, Talimco and Rogers failed to fulfill their fiduciary duty to their client,” said Daniel Michael, Chief of the SEC Enforcement Division’s Complex Financial Instruments Unit.  “Investment adviser firms are expected to have controls in place to detect and disclose conflicts of interest.  This action evidences the vigilance of the SEC’s exam and enforcement staff in identifying investments advisers that exploit client relationships and harm investors.”

The settled orders find that Talimco and Rogers violated Section 206(2) of the Investment Advisers Act.  Without admitting or denying the findings in the order, Talimco consented to a cease-and-desist order, a censure, disgorgement of its fees of $74,000 plus prejudgment interest of $8,758.80 and a penalty of $325,000.  Rogers, who also did not admit nor deny the findings, consented to a cease-and-desist order, a 12-month industry suspension, and a $65,000 fine.

The SEC’s investigation was conducted by Philip A. Fortino, Sharon Bryant, and Osman Nawaz of the Complex Financial Instruments Unit and Haimavathi Marlier and Thomas P. Smith Jr. of the New York Regional Office, and was supervised by Mr. Michael and Lara S. Mehraban.  An examination that led to the investigation was conducted by the Private Funds Unit. 

SEC Press Release

— If you believe need help with a securities litigation, arbitration or litigation issue, email Mark Astarita or call 212-509-6544 to speak to a securities lawyer.

from SECLaw.com

SEC Staff to Hold Fintech Forum to Discuss Distributed Ledger Technology and Digital Assets

The Securities and Exchange Commission today announced that its staff will host a public forum focusing on distributed ledger technology (DLT) and digital assets on May 31, 2019.  The forum is being organized by the agency’s Strategic Hub for Innovation and Financial Technology (FinHub) and was announced in connection with the launch of FinHub last year.  FinHub is committed to active engagement with market participants on new financial technologies.  The forum is the second such forum to be hosted by the agency, will feature panelists from industry and academia, and is designed to foster greater communication and understanding around issues involving DLT and digital assets.  Panelists will explore such topics as initial coin offerings, digital asset platforms, DLT innovations, and how these technologies impact investors and the markets.   

The Fintech Forum will be held at the SEC’s Washington D.C. headquarters on May 31 and will be open to the public and webcast live via the SEC’s website.  More information on the agenda and participants will be published in the coming weeks.

SEC Press Release

— If you believe need help with a securities litigation, arbitration or litigation issue, email Mark Astarita or call 212-509-6544 to speak to a securities lawyer.

from Blogger https://ift.tt/2W8KjIv

SEC Staff to Hold Fintech Forum to Discuss Distributed Ledger Technology and Digital Assets

The Securities and Exchange Commission today announced that its staff will host a public forum focusing on distributed ledger technology (DLT) and digital assets on May 31, 2019.  The forum is being organized by the agency’s Strategic Hub for Innovation and Financial Technology (FinHub) and was announced in connection with the launch of FinHub last year.  FinHub is committed to active engagement with market participants on new financial technologies.  The forum is the second such forum to be hosted by the agency, will feature panelists from industry and academia, and is designed to foster greater communication and understanding around issues involving DLT and digital assets.  Panelists will explore such topics as initial coin offerings, digital asset platforms, DLT innovations, and how these technologies impact investors and the markets.   

The Fintech Forum will be held at the SEC’s Washington D.C. headquarters on May 31 and will be open to the public and webcast live via the SEC’s website.  More information on the agenda and participants will be published in the coming weeks.

SEC Press Release

— If you believe need help with a securities litigation, arbitration or litigation issue, email Mark Astarita or call 212-509-6544 to speak to a securities lawyer.

from SECLaw.com

GPB Capital, Brokers Under Fire

Already
the focus of inquiries by the SEC and FINRA, the FBI recently made an
unannounced visit to the New York investment firm, GPB Capital Holdings.

GPB Capital has raised $1.8 billion through private placements. It raises those funds by getting financial advisers to sell GPB private placements to wealthy clients. According to its website, GPB Capital uses those funds to purchase income producing private companies.

Registered
reps from dozens of independent broker-dealers sold the high risk,
high-commission private placements.

GPB is the subject of other investigations and investor lawsuits. For example, it is being investigated by the Securities and Exchange Commission as well as the New Jersey Bureau of Securities, according to the company.

The focus of the SEC’s inquiry was the accuracy of disclosures made by GPB to investors, the performance of various funds and the distribution of capital to investors, according to published reports.

If you have any questions or concerns regarding your investment in GPB Capital, or any other private placement, contact Mark Astarita at mja@seclaw.com. Mark has been representing investors and financial professionals in securities disputes for over 25 years, and has represented parties in over 700 securities arbitrations. 

from Blogger https://ift.tt/2TH4xfk

GPB Capital, Brokers Under Fire

Already
the focus of inquiries by the SEC and FINRA, the FBI recently made an
unannounced visit to the New York investment firm, GPB Capital Holdings.

GPB Capital has raised $1.8 billion through private placements. It raises those funds by getting financial advisers to sell GPB private placements to wealthy clients. According to its website, GPB Capital uses those funds to purchase income producing private companies.

Registered
reps from dozens of independent broker-dealers sold the high risk,
high-commission private placements.

GPB is the subject of other investigations and investor lawsuits. For example, it is being investigated by the Securities and Exchange Commission as well as the New Jersey Bureau of Securities, according to the company.

The focus of the SEC’s inquiry was the accuracy of disclosures made by GPB to investors, the performance of various funds and the distribution of capital to investors, according to published reports.

If you have any questions or concerns regarding your investment in GPB Capital, or any other private placement, contact Mark Astarita at mja@seclaw.com. Mark has been representing investors and financial professionals in securities disputes for over 25 years, and has represented parties in over 700 securities arbitrations. 

from SECLaw.com