Editor's Note
The following newsletter provides a roundup summarizing enforcement actions, guidance, rulemakings, and other public statements taken by a federal and/or state financial services regulatory agency, specifically focusing on: (1) the source of the development (regulator, legislative body, etc.), (2) the subject matter (consumer lending, money transmission, capital markets, etc.), and (3) the general issue covered.

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Regulatory Developments

Enforcement and Litigation

  • Commodity Futures Trading Commission. CFTC vs. FOX Holdings, L.L.C.; Andrew Gizienski. On January 8, 2024, the Fifth Circuit held that "the Defendants lacked fair notice of the CFTC's unprecedented interpretation" of "17 C.F.R. § 155.4(b)(2)(i), a regulation that prevents commodities traders from ‘taking the other side of orders' without clients' consent." The judgment was reversed in part and the case remanded.
  • Department of Justice. High-Yield Investment Fraud Scheme. On January 5, 2024, DOJ announced that Daniel Thomas Broyles Sr. aka Dan Thomas was sentenced to four years in prison for his role in high-yield investment fraud schemes.
  • New York State Department of Financial Services. Anti-Money Laundering and Cybersecurity. On January 12, 2024, NYDFS announced an $8 million penalty against Genesis Global Trading, Inc. after a DFS investigation found significant failings in the firm's Anti-Money Laundering and Cybersecurity Programs.
  • Securities and Exchange Commission. Real Estate Investment Fraud. On January 3, 2024, the SEC announced that it obtained an asset freeze and other emergency relief concerning an alleged $93 million real estate investment fraud perpetrated by Miami-based developer Rishi Kapoor.
  • Securities and Exchange Commission. Foreign Corrupt Practices Act. On January 10, 2024, the SEC announced charges against global software company SAP for FCPA violations. The Department of Justice also announced that SAP will pay over $220 million to resolve SEC's investigations.
  • Securities and Exchange Commission. Manipulative Trading. On January 11, 2024, SEC announced charges against Future FinTech's CEO with manipulative trading using an offshore account and with multiple disclosure failures.

Jonathan Cristol is a regulatory analyst with Davis Wright Tremaine LLP.