The Wall Street Legal & Regulatory Feed
Securities Industry Commentator by Bill Singer Esq
January 29, 2018
FINRA Department of Enforcement, Complainant, vs Joseph C. Farah, Respondent (Order Accepting Offer of Settlement, FINRA Office of Hearing Officers, 2014041432401, January 25, 2018) http://www.finra.org/sites/default/files/fda_documents/2014041432401%20Joseph
%20C%20Farah%20CRD%202978633%20Order%20sl.pdf
In response to the filing of a Complaint on May 8, 2017, by the Department of Enforcement of the Financial Industry Regulatory Authority ("FINRA"), Respondent Joseph C. Farah submitted an Offer of Settlement dated January 17, 2018, which the regulator accepted. Under the terms of the Offer of Settlement, without admitting or denying the allegations in the Complaint, Respondent Joseph C. Farah consented to the entry of findings and violations and to the imposition of the sanctions. FINRA Department of Enforcement, Complainant, vs Joseph C. Farah, Respondent (Order Accepting Offer of Settlement, FINRA Office of Hearing Officers, 2014041432401, January 25, 2018) (the "Order"). In accordance with the terms of the Order, FINRA imposed upon Farah a bar from associating with any FINRA member firm in all capacities. As set forth in the "SUMMARY" of the FINRA Offer of Settlement:
%20C%20Farah%20CRD%202978633%20Order%20sl.pdf
In response to the filing of a Complaint on May 8, 2017, by the Department of Enforcement of the Financial Industry Regulatory Authority ("FINRA"), Respondent Joseph C. Farah submitted an Offer of Settlement dated January 17, 2018, which the regulator accepted. Under the terms of the Offer of Settlement, without admitting or denying the allegations in the Complaint, Respondent Joseph C. Farah consented to the entry of findings and violations and to the imposition of the sanctions. FINRA Department of Enforcement, Complainant, vs Joseph C. Farah, Respondent (Order Accepting Offer of Settlement, FINRA Office of Hearing Officers, 2014041432401, January 25, 2018) (the "Order"). In accordance with the terms of the Order, FINRA imposed upon Farah a bar from associating with any FINRA member firm in all capacities. As set forth in the "SUMMARY" of the FINRA Offer of Settlement:
While associated with Gold Coast Securities, Farah persuaded Gold Coast customer LN to open an account at TD Ameritrade and to provide him with discretionary authority over that account. Farah promised that he would reimburse LN for any losses in her TD Ameritrade account and, in exchange, take a portion of the profits.There were, however, no profits. From November 2012 through October 2013, Farah excessively traded LN's TD Ameritrade account-executing more than 600 trades that caused LN's account value to diminish by more than 25 percent.Farah never informed Gold Coast that he had discretionary authority over LN's TD Ameritrade account. Nor did he inform Gold Coast that he had discretionary authority over four other TD Ameritrade accounts (belonging to three other individuals and one entity). To the contrary, on annual compliance questionnaires, he falsely denied having discretionary authority over any accounts.On these annual compliance questionnaires, Farah also falsely denied involvement in any business enterprise. He never disclosed to Gold Coast that he had established and co-owned a corporation, Farah & Neal, Executive Benefits/Wealth Management Inc. ("Farah & Neal Benefits") that was intended to provide financial advice to business owners.Through this conduct, Farah violated: (i) FINRA Rules 2111 and 2010, by excessively trading LN's account (First Cause of Action); (ii) NASD Rule 3050 and FINRA Rule 2010 by failing to notify Gold Coast that he had discretionary authority over five accounts and by failing to notify TD Ameritrade that he was a registered representative associated with Gold Coast (Second Cause of Action); (iii) FINRA Rules 3270 and 2010 by failing to disclose Farah & Neal Benefits as an outside business activity (Third Cause of Action); and (iv) FINRA Rule 2010 by providing materially false information to Gold Coast on its annual compliance questionnaires (Fourth Cause of Action).
BNP Paribas USA Inc. Pleads Guilty to Antitrust Conspiracy / Sixth Major Bank to Plead Guilty in Ongoing Foreign Currency Exchange Investigation Agrees to Pay $90 Million Criminal Fine (DOJ Press Release) https://www.justice.gov/opa/pr/bnp-paribas-usa-inc-pleads-guilty-antitrust-conspiracy
BNP Paribas USA Inc.(BNPP USA), a subsidiary of BNP Paribas S.A., pleaded guilty to a one-count Information filed in the U.S. District Court for the Southern District of New York that alleged that between September 2011 and July 2013, BNPP USA conspired to suppress and eliminate competition by fixing prices in Central and Eastern European, Middle Eastern and African (CEEMEA) currencies. BNPP USA agreed to pay a criminal fine of $90 million. Both the government and BNPP USA have agreed to recommend no probation, in light of, among other factors, the bank's substantial efforts relating to compliance and remediation. BNPP USA also has agreed to cooperate with the government's ongoing criminal investigation into the FX market, and to report relevant information to the government. On May 20, 2015, four major banks - Citicorp, JPMorgan Chase & Co., Barclays PLC and The Royal Bank of Scotland plc - pleaded guilty at the parent level and agreed to pay collectively more than $2.5 billion in criminal fines for their participation in an antitrust conspiracy to manipulate the price of U.S. dollars and euros exchanged in the FX market. A fifth bank, UBS AG, pleaded guilty to manipulating the London Interbank Offered Rate (LIBOR) and other benchmark interest rates and agreed to pay a $203 million criminal penalty, after breaching its December 2012 non-prosecution agreement resolving the LIBOR investigation. READ the FULL TEXT Information
https://www.justice.gov/opa/press-release/file/1028886/downloadn
BNP Paribas USA Inc.(BNPP USA), a subsidiary of BNP Paribas S.A., pleaded guilty to a one-count Information filed in the U.S. District Court for the Southern District of New York that alleged that between September 2011 and July 2013, BNPP USA conspired to suppress and eliminate competition by fixing prices in Central and Eastern European, Middle Eastern and African (CEEMEA) currencies. BNPP USA agreed to pay a criminal fine of $90 million. Both the government and BNPP USA have agreed to recommend no probation, in light of, among other factors, the bank's substantial efforts relating to compliance and remediation. BNPP USA also has agreed to cooperate with the government's ongoing criminal investigation into the FX market, and to report relevant information to the government. On May 20, 2015, four major banks - Citicorp, JPMorgan Chase & Co., Barclays PLC and The Royal Bank of Scotland plc - pleaded guilty at the parent level and agreed to pay collectively more than $2.5 billion in criminal fines for their participation in an antitrust conspiracy to manipulate the price of U.S. dollars and euros exchanged in the FX market. A fifth bank, UBS AG, pleaded guilty to manipulating the London Interbank Offered Rate (LIBOR) and other benchmark interest rates and agreed to pay a $203 million criminal penalty, after breaching its December 2012 non-prosecution agreement resolving the LIBOR investigation. READ the FULL TEXT Information
https://www.justice.gov/opa/press-release/file/1028886/downloadn
SEC Freezes Assets Behind Alleged Insider Trading (SEC Litigation Release No. 24035) https://www.sec.gov/litigation/litreleases/2018/lr24035.htm
In Securities and Exchange Commission v. One or More Unknown Traders in the Securities of Bioverativ, Inc. (United States District Court for the Southern District of New York, 18-CV-0701), the Court entered an emergency court order freezing assets related to alleged insider trading that yielded approximately $5 million in profits in connection with Sanofi S.A,'s acquisition at $105 a share of Bioverativ Inc, The SEC alleged that in the days prior to the public announcement of the acquisition, unknown traders used foreign brokerage accounts in Switzerland to purchase out-of-the-money call options through a U.S.-based brokerage firm and on U.S.-based exchanges.The emergency court order obtained by the SEC requires the traders to repatriate any funds or assets located outside the U.S. that were obtained from the alleged insider trading. The traders also are prohibited from destroying any evidence. READ the FULL TEXT SEC Complaint
https://www.sec.gov/litigation/complaints/2018/comp24035.pdf
https://www.sec.gov/litigation/complaints/2018/comp24035.pdf
The SEC, The Federal Inmate, And The Florida Bar Advice (BrokeAndBroker.com Blog) http://www.brokeandbroker.com/3796/sec-inmate-service/
There are times when you just have to shake your head and wonder. As I get older, I find my neck getting sore from all the back and forth twisting. You start trying to explain something and the words just don't come out and the more you try to think about what to say, the more you realize how stupid and absurd the whole thing is and, maybe, just maybe, there ain't no way to explain the thing you're trying to explain because it's so ridiculous as to be unexplainable. Which brings to mind the eye poppin', jaw droppin' escapades of fraudster Joseph Vitale, now known as federal inmate #15859-104 READ http://www.brokeandbroker.com/3796/sec-inmate-service/
Nigerian Man Extradited From South Africa For Participating In Business Email Compromise Scams (DOJ Press Release 18-030) https://www.justice.gov/usao-sdny/pr/nigerian-man-extradited-south-africa-participating-business-email-compromise-scams Following his arrest in December 2016 in South Africa, Onyekachi Emmanuel Opara of Lagos, Nigeria, was extradited to the United States in connection with an Indictment in the United States District Court for the Southern District of New York charging him with one count of conspiracy to commit wire fraud and one count of wire fraud arising from his alleged participation in fraudulent business email compromise scams that targeted thousands of victims around the world, including the United States. Co-defendant David Chukwuneke Adindu was previously sentenced to 41 months in prison for participating in the business email compromise scams. As set forth in part in the DOJ Press Release:
Between 2014 and 2016, OPARA and Adindu participated in Business Email Compromise scams ("BEC scams") targeting thousands of victims around the world, including in the United States. As part of the BEC scams, emails were sent to employees of various companies directing that funds be transferred to specified bank accounts. The emails purported to be from supervisors at those companies or third party vendors that did business with those companies. The emails, however, were not legitimate. Rather, they were either from email accounts with a domain name that was very similar to a legitimate domain name, or the metadata in the emails had been modified so that the emails appeared as if they were from legitimate email addresses. After victims complied with the fraudulent wiring instructions, the transferred funds were quickly withdrawn or moved into different bank accounts. In total, the BEC scams attempted to defraud millions of dollars from victims.