Supreme Court Casts Doubts on a Potent S.E.C. Weapon

The Securities and Exchange Commission routinely seeks an order in an enforcement action to require a defendant to repay any ill-gotten gains, a remedy called disgorgement.

The notion is that a thief should not be able to keep what was stolen, but instead should be required to account for the misconduct by turning over the proceeds to the government.

A recent Supreme Court decision will now require that a case seeking disgorgement be filed within five years of the violation, pushing the regulator to complete its investigation more quickly or risk losing that remedy. More ominously, although disgorgement is so well established that is it rarely challenged, the court raised a question about whether it was even available for a violation of the securities laws, which may lead to reconsideration of one of the Securities and Exchange Commission’s most potent weapons. read more »

Following the Pills: Inside the Government’s Investigation of McKesson

On a brisk morning in March 2013, dozens of DEA agents descended upon a warehouse in Aurora, Colo.

This was not your typical drug bust—the breaking up of a meth lab or some seedy way station in the illicit drug trade. The facility where the investigators had assembled that morning, brandishing an Administrative Inspection Warrant, was a distribution center operated by one of America’s largest public companies, the giant drug wholesaler McKesson, which ranks No. 5 on this year’s Fortune 500.

The incident is a case study in how companies in the pharmaceutical supply chain have come under fire for their alleged role in the country's opioid crisis and of the questions that have been raised about the responsibility of middleman companies that distribute prescription painkillers. read more »

Deutsche Bank reaches $170 million Euribor-rigging settlement

Deutsche Bank AG will pay $170 million to settle an investor lawsuit claiming it conspired with other banks to manipulate the benchmark European Interbank Offered Rate and related derivatives.

A preliminary settlement was filed on Monday with the U.S. District Court in Manhattan, and requires a judge's approval.

It follows similar settlements with Barclays Plc and HSBC Holdings Plc for a respective $94 million and $45 million, which have won preliminary court approval.

Euribor is the euro-denominated equivalent of Libor, a benchmark for setting rates on hundreds of trillions of dollars of credit cards, student loans, mortgages and other debt. read more »

Ex-Traders in Britain to Face Currency-Rigging Charges in U.S.

Three former traders in Britain have agreed to travel to the United States to face criminal charges that they were part of a conspiracy to rig foreign currency markets.

The criminal case represents a stark contrast in the approach that British and United States authorities have taken in a long-running series of inquiries into whether bankers had colluded to manipulate the trading of currencies, an area that is lightly regulated.

In the last three years, some of the world’s biggest banks, including Barclays, Citigroup, JPMorgan Chase and the Royal Bank of Scotland, have agreed to pay billions in civil penalties in the inquiries and some banks have pleaded guilty to criminal charges in the United States. Several traders also have lost their jobs as a result.

But only United States authorities have brought criminal charges against any individuals. British authorities closed their investigation without any criminal charges last year. read more »

Toshiba facing fresh demand for damages

Japanese electronics giant Toshiba says it is facing a fresh lawsuit from another group of foreign investors seeking damages following its $1.2bn accounting scandal.

The company says it has now been served with 26 complaints in total, demanding nearly $1bn in compensation.

Last month, Toshiba warned it could collapse because of soaring losses.

Originally known for its consumer electronics products, Toshiba has faced a series of difficulties.

An accounting scandal, uncovered in 2015, led to the resignation of several members of the firm's senior management, including the chief executive, after the company was found to have inflated the previous seven years' profits by $1.2bn. read more »