http://nysbar.com/blogs/SecuritiesLitigation/ Sponsored by the Commercial and Federal Litigation Section of the New York State Bar Association All data and information provided on this site is for informational purposes only. Nothing contained herein is intended as legal or financial advice and no representation is made about the accuracy of the information. en Copyright 2010 Mon, 30 Aug 2010 15:06:58 +0000 http://www.sixapart.com/movabletype/ http://blogs.law.harvard.edu/tech/rss Written by Edward Pekarek, Esq. and Christopher Lufrano* At the zenith of the domestic real estate “bubble” from 2004-2007, Goldman Sachs Group, Inc. facilitated several controversial structured finance derivative transactions that referenced domestic residential mortgage-backed securities (RMBS) which contained mortgages with subprime credit quality. In at least one of these RMBS deals, Goldman facilitated a short sale for one of its hedge fund clients, Paulson & Co., through the creation of a Credit Default Swap (CDS) contract that referenced a synthetic Collateralized Debt Obligation (CDO) known as “ABACUS 2007 AC-1.” Unbeknownst to ABACUS investors, and in an apparent conflict of interest, Paulson also participated extensively in the selection of the RMBS reference portfolio for ABACUS.]]> http://nysbar.com/blogs/SecuritiesLitigation/2010/08/goldman_sachs_the_year_of_the.html http://nysbar.com/blogs/SecuritiesLitigation/2010/08/goldman_sachs_the_year_of_the.html Mon, 30 Aug 2010 15:06:58 +0000 Written by Nancy Campanozzi, Esq. On July 27, 2010, the Securities and Exchange Commission (SEC) published a request for public comment on a study the SEC is required to conduct regarding the obligations of brokers/dealers, and investment advisers to retail customers as part of the Dodd-Frank Wall Street Reform and Consumer Protection Act that President Obama signed into law on July 21, 2010. [Release No. 34-62577; IA-3058; File No. 4-606] ]]> http://nysbar.com/blogs/SecuritiesLitigation/2010/08/sec_seeks_comments_on_the_dodd.html http://nysbar.com/blogs/SecuritiesLitigation/2010/08/sec_seeks_comments_on_the_dodd.html Securities Law Thu, 26 Aug 2010 20:56:00 +0000 Written by Nancy Campanozzi, Esq. On July 12, 2010, FINRA filed the Notice of Proposed Rule Change Amendments to the Discovery Guide and Rules 12506 and 12508 of the Code of Arbitration Procedure for Customer Disputes with the SEC. The Amendments to the Discovery Guide, (Guide) proposes to replace the 14 current Lists of “presumptively discoverable documents” with two lists. The Guide’s Introduction would be revised to expand the guidance given to parties and arbitrators on the discovery process generally and provide clarification as to how arbitrators should apply the Guide in arbitration proceedings. In addition to the section of the Introduction that states that arbitrators can order parties to produce documents that are not on the lists or alter the parties’ production schedule, the proposed rule would add flexibility to the arbitrators by enabling them to order that parties do not have to produce certain documents. ]]> http://nysbar.com/blogs/SecuritiesLitigation/2010/08/finra_proposes_new_discovery_g.html http://nysbar.com/blogs/SecuritiesLitigation/2010/08/finra_proposes_new_discovery_g.html Securities Arbitration Thu, 19 Aug 2010 16:27:14 +0000 Written by Christine Lazaro, Esq. On July 9, 2010, the SEC approved FINRA’s proposal to increase the number of arbitrators on lists generated by the Neutral List Selection System (NLSS) under FINRA Rules 12403, 12404, 13403 and 13404. The lists of arbitrators presented to parties in arbitrations before FINRA will be expanded from eight names to ten names, but the number of strikes available to each party will remain the same. ]]> http://nysbar.com/blogs/SecuritiesLitigation/2010/07/sec_approves_finra_rule_propos.html http://nysbar.com/blogs/SecuritiesLitigation/2010/07/sec_approves_finra_rule_propos.html Securities Arbitration Mon, 19 Jul 2010 15:51:06 +0000 Written by Christine Lazaro, Esq. On July 8, 2010, the SEC approved FINRA’s proposal to expand BrokerCheck. Once implemented, the changes to BrokerCheck will result in an increase in the number of customer complaints reported publicly because all historic complaints against a broker dating back to 1999, when electronic filing of broker information began will now be reported. Additionally, FINRA has extended the public disclosure period for the full record of a broker who leaves the industry from two years to 10 years. Additionally, FINRA is making certain information about former brokers available permanently, such as criminal convictions and certain civil injunctive actions and arbitration awards against the broker. ]]> http://nysbar.com/blogs/SecuritiesLitigation/2010/07/sec_approves_further_changes_t.html http://nysbar.com/blogs/SecuritiesLitigation/2010/07/sec_approves_further_changes_t.html Securities Arbitration Mon, 19 Jul 2010 15:46:05 +0000 Written by Christine Lazaro, Esq. On June 2, 2010, the SEC approved FINRA's proposed changes to Rule 9554, eliminating the inability-to-pay defense in the expedited proceedings context when a member or associated person fails to pay an arbitration award to a customer. FINRA is required to consider the defense in disciplinary cases, however, the SEC pointed out that the reasons present that require FINRA to consider the defense in disciplinary cases are not present in expedited cases.]]> http://nysbar.com/blogs/SecuritiesLitigation/2010/06/sec_approves_proposal_to_elimi.html http://nysbar.com/blogs/SecuritiesLitigation/2010/06/sec_approves_proposal_to_elimi.html Securities Arbitration Tue, 08 Jun 2010 20:51:00 +0000 Webmaster@nysba.org and put Securities Litigation blog in the subject line. Thank you for your interest. Barbara Beauchamp Blogmaster New York State Bar Association]]> http://nysbar.com/blogs/SecuritiesLitigation/2010/05/thanks_dave.html http://nysbar.com/blogs/SecuritiesLitigation/2010/05/thanks_dave.html Thu, 13 May 2010 15:59:39 +0000 Written by Brent A. Burns On April 1, 2010, FINRA announced it is amending its rules regarding the selection of hearing locations to allow customers and associated persons more flexibility. The effective date of the amendments is May 3, 2010. Under the current customer code, Rule 12213(a), the Director of FINRA Dispute Resolution selects the hearing location closest to the customer’s residence at the time of the events giving rise to the dispute. Under the amended rule, a customer will now also be able to request a hearing location in the state where the customer resided at the time of the event giving rise to the dispute. ]]> http://nysbar.com/blogs/SecuritiesLitigation/2010/04/finra_amends_its_rules_regardi.html http://nysbar.com/blogs/SecuritiesLitigation/2010/04/finra_amends_its_rules_regardi.html Securities Arbitration Thu, 08 Apr 2010 20:50:29 +0000 Written by Christine Lazaro, Esq. On March 10, 2010, the Securities and Exchange Commission issued a press release alerting investors about a web site that falsely claims to have recovered $1.3 billion in funds hidden by convicted Ponzi schemer Bernard Madoff in Malaysia. The website purports to be that of the "International Security Investor Protection Corporation", which is a ficticious entity.]]> http://nysbar.com/blogs/SecuritiesLitigation/2010/03/sec_warns_of_investor_scam_rel.html http://nysbar.com/blogs/SecuritiesLitigation/2010/03/sec_warns_of_investor_scam_rel.html Securities News Wed, 17 Mar 2010 21:15:44 +0000 Written by Christine Lazaro, Esq. On February 17, 2010, FINRA announced that it will submit a proposal to further expand BrokerCheck to the SEC shortly. FINRA describes BrokerCheck as a free tool offered by FINRA which allows investors to check the professional background of current and former FINRA-registered securities firms and brokers. In the press release, FINRA explains that the proposal would increase the number of customer complaints reported publicly; extend the public disclosure period for the full record of a broker who leaves the industry from two years to 10 years; and, make certain information about former brokers available permanently, such as criminal convictions and certain civil and arbitration judgments. ]]> http://nysbar.com/blogs/SecuritiesLitigation/2010/02/finra_proposes_to_further_expa.html http://nysbar.com/blogs/SecuritiesLitigation/2010/02/finra_proposes_to_further_expa.html Securities Arbitration Mon, 22 Feb 2010 17:00:14 +0000 Written by David Welch, Esq. ...Continued from Control Person Liability Post on September 21, 2009: The success or failure of a pre-hearing Motion to Dismiss a control person liability claim may at times depend on which standard the arbitrators or judge choose to adopt: the “culpable participation” standard or the “potential control standard.” Although some courts are bound by precedential case law to apply a certain standard, many jurisdictions have not definitely selected an appropriate standard and arbitrators, after all, are free to apply whichever standard they deem appropriate. Thus, parties involved in control person liability disputes often commit significant efforts to advocating the standard that best suits their needs. Although defective control person liability claims can be dismissed under the “potential control” standard, as discussed below, it generally behooves control persons to advocate in favor of the application of the “culpable participation” standard. The “Culpable Participation” Standard]]> http://nysbar.com/blogs/SecuritiesLitigation/2010/01/control_person_liability_conti.html http://nysbar.com/blogs/SecuritiesLitigation/2010/01/control_person_liability_conti.html Securities Litigation Thu, 14 Jan 2010 22:44:54 +0000 Regulatory Notice 09-74. The changes, in pertinent part are as follows: ]]> http://nysbar.com/blogs/SecuritiesLitigation/2009/12/sec_approves_amendments_to_arb.html http://nysbar.com/blogs/SecuritiesLitigation/2009/12/sec_approves_amendments_to_arb.html Mon, 21 Dec 2009 19:51:36 +0000 here. ]]> http://nysbar.com/blogs/SecuritiesLitigation/2009/11/proposed_restoring_american_fi.html http://nysbar.com/blogs/SecuritiesLitigation/2009/11/proposed_restoring_american_fi.html Securities Law Fri, 20 Nov 2009 16:40:08 +0000 here (New York Securities) and here (Perceptive Advisors). For more on what constitutes a violation of Rule 105 read here. ]]> http://nysbar.com/blogs/SecuritiesLitigation/2009/10/two_recently_settled_sec_actio.html http://nysbar.com/blogs/SecuritiesLitigation/2009/10/two_recently_settled_sec_actio.html Securities Law Wed, 21 Oct 2009 15:36:29 +0000 Written by Arpan Parmar* In April 2009, FINRA’s Board of Governors established a Special Review Committee to conduct an internal review of FINRA’s examination program as it relates to FINRA member firms associated with R. Allen Stanford and Bernard L. Madoff. The Committee consisted of four FINRA public governors: Ellyn L. Brown, Brown & Associates; Harvey J. Goldschmid, Dwight Professor of Law at Columbia University; Joel Seligman, President of the University of Rochester; and, Committee Chair, Charles A. Bowsher. The Board asked the Committee to recommend changes in the examination program to improve member oversight, fraud detection capability and FINRA’s monitoring of compliance with examination program policies. In September 2009, the Committee provided a report of their findings.]]> http://nysbar.com/blogs/SecuritiesLitigation/2009/10/changes_at_finra_in_the_wake_o.html http://nysbar.com/blogs/SecuritiesLitigation/2009/10/changes_at_finra_in_the_wake_o.html Securities Law Tue, 20 Oct 2009 15:18:51 +0000