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Federal Securities Law Blog Information on federal securities laws, news and developments

SEC Enforcement Activity: Feb. 11- 15

Posted in Insider Trading, SEC Enforcement Cases

Second Circuit Hears Oral Argument on SEC-Citigroup Settlement

Last November, a federal judge in New York rejected a proposed settlement between the SEC and Citigroup in connection with charges of misleading investors at the beginning of the financial crisis. This week the Second Circuit Court of Appeals heard oral arguments in the case, which saw the SEC and Citigroup join forces against the District Court. Jim Hamilton has a good analysis of the proceedings here

Former Stanford Financial Group Executives Sentenced to 20 Years

The last two defendants in the case against Allen Stanford’s $7.2 billion ponzi scheme were each sentenced this week to 20 years in prison. Gilbert Lopez and Mark Kuhrt, the group’s chief accountant and controller, were found guilty by a jury in a Houston federal court of wire fraud and conspiracy. Allen Stanford, the primary defendant in the case, received a 110-year prison sentence in March 2012. More from Reuters.

Trader Settles “Cherry-Picking” Charges for $7 Million

Howard Berger and his wife agreed to a consent judgment with the SEC, settling charges that Berger “cherry-picked” profits from his hedge funds. The SEC alleged that Berger had engaged in “cherry-picking,” skimming profitable trades from his hedge fund and transferring them into his wife’s brokerage account. The scheme reaped an alleged $6.8 million in profit for the couple, who settled for around $7 million.

Insider Trading: SEC Wins Judgment In Healthcare Tipping Ring

A federal court in New York awarded final judgment to the SEC in connection with their charges against three members of a tipping ring. Alexander Vorobieva, Igor Poteroba, and Aksey Koval all benefitted from information about healthcare related transactions including acquisitions and tender offers. The ring began with Poteroba, who learned of upcoming transactions in his capacity as an investment banker in UBS’ Global Healthcare Group. Poteroba then informed Koval, who tipped Vorobieva. The final entry included a judgment against Vorobieva of over $2 million.