Generic-Drug Companies to Face First Charges in U.S. Probe

U.S. prosecutors are nearing their first charges against companies in an almost four-year-old criminal investigation into alleged price-fixing by generic-drug makers, according to people familiar with the matter.

At least two companies are on track to be indicted in the coming months, in addition to several executives, said two people, who spoke on condition of anonymity because the investigation is confidential. Another company could agree to plead guilty before then, said one the people.

The charges, which the people said could be filed as soon as the summer, would mark a major breakthrough in an investigation that began in 2014 and has spread to nearly every major generic-drug manufacturer, including Mylan NV and Teva Pharmaceutical Industries Ltd. read more »

Is the VIX Being Manipulated?

A conspicuous rise in the CBOE VIX last Wednesday has reignited a long-standing debate over the soundness of the Wall Street fear index. Now, traders are asking whether the VIX is just plain broken or being gamed by holders of derivatives.

The CBOE Volatility Index measures how much traders are willing to pay for options that are used to hedge against future stock-market declines. The so-called “fear index” normally trades inversely with the S&P 500 Index, which means it rises when stocks fall or vice versa.

On Apr. 18, the VIX spiked 12% in the first 30 minutes of trading, marking the biggest move since 2010, according to data gathered by Macro Risk Advisors and The Wall Street Journal.

The following chart, courtesy of WSJ, illustrates the dramatic surge between 9:00 a.m. and 9:30 a.m. The only comparable move after the opening bell occurred on Feb. 14, when the index dropped nearly 14%. read more »

French billionaire Vincent Bolloré detained for questioning by anti-corruption police near Paris.

Mr Bolloré's business empire includes shipping, advertising, construction and media and has large interests in Africa. He is one of France's best-known businessmen.

Investigators are looking into allegations that his Havas advertising agency provided discounted communications advice to Guinean President Alpha Condé and Togolese President Faure Gnassingbé at election time in return for the Bolloré Africa Logistics company being given licences to operate container ports in Conakry and Lomé. read more »

Former CFTC Head Says Big Cryptocurrencies Could Be Classified as Securities

Tokens sold in initial coin offerings have come under increased scrutiny from U.S. regulators, but some of the biggest cryptocurrencies aren’t necessarily off the hook.

Gary Gensler, the former chairman of the Commodity Futures Trading Commission, said that government officials should take a closer look at the largest coins by market capitalization, not just at tokens sold in ICOs. Ethereum’s Ether and Ripple’s XRP could probably be classified as securities, Gensler said.

“The SEC and regulators need to bring clarity,” Gensler said at MIT Technology Review’s Business of Blockchain conference on Monday. Many cryptocurrenciers “are operating outside of U.S. laws.”

One of the ways regulators determine if an asset is a security is with the so-called Howey Test. For Gensler, buying Ripple’s XRP and Ether meets the requirements of the test as there’s an investment of money in a common enterprise, and the expectation of profit which comes from the efforts of a third party. The common enterprise for Ripple would be Ripple Labs, and for ether it would be the Ethereum Foundation, Gensler said.

“There’s a strong case, particularly for Ripple,” Gensler said, as Ether is more decentralized. read more »

U.S. Supreme Court Shields Corporations From Human-Rights Suits

The U.S. Supreme Court ruled that victims of overseas atrocities can’t use a centuries-old law to sue foreign corporations for complicity, blunting what once was a favorite legal tool for human-rights advocates.

The 5-4 ruling on Tuesday, which divided the court along ideological lines, marks the second time in five years the high court has cut the reach of the 1789 Alien Tort Statute.

The latest ruling throws out a suit stemming from terrorist attacks in Israel and the Palestinian territories. Victims and family members accused Jordan-based Arab Bank Plc of using its New York branch to distribute millions of dollars to terrorists and their families. read more »

Altaba, Formerly Known as Yahoo!, Charged With Failing to Disclose Massive Cybersecurity Breach; Agrees To Pay $35 Million

The Securities and Exchange Commission today announced that the entity formerly known as Yahoo! Inc. has agreed to pay a $35 million penalty to settle charges that it misled investors by failing to disclose one of the world’s largest data breaches in which hackers stole personal data relating to hundreds of millions of user accounts.

According to the SEC’s order, within days of the December 2014 intrusion, Yahoo’s information security team learned that Russian hackers had stolen what the security team referred to internally as the company’s “crown jewels”: usernames, email addresses, phone numbers, birthdates, encrypted passwords, and security questions and answers for hundreds of millions of user accounts.  Although information relating to the breach was reported to members of Yahoo’s senior management and legal department, Yahoo failed to properly investigate the circumstances of the breach and to adequately consider whether the breach needed to be disclosed to investors.  The fact of the breach was not disclosed to the investing public until more than two years later, when in 2016 Yahoo was in the process of closing the acquisition of its operating business by Verizon Communications, Inc.  read more »