The SEC and a consortium of 32 states recently announced a $100 million settlement with BlockFi Lending LLC over its crypto lending product, BlockFi Interest Accounts. The SEC alleged BlockFi had violated the securities laws by failing to register its interest-bearing crypto lending product as a security, failing to register itself as an investment company,
SEC Charges Eight Companies and Signals Need for Better Disclosures About Delayed Filings
On April 29, 2021, the Securities and Exchange Commission (the “SEC”) announced settled charges against eight public companies that filed notifications of late filings on Form 12b-25 (more commonly known as “Form NT”) without disclosing in those filings a pending restatement or correction of financial statements.
These settlements are a reminder that filing a Form…
SEC Brings Rare Litigated Enforcement Action for Violation of Regulation FD
On March 5, 2021, the Securities and Exchange Commission (“SEC”) filed a lawsuit in federal court against AT&T, Inc. (“AT&T”) for violating Regulation FD, and also charged three of AT&T’s Investor Relations executives with aiding and abetting this violation. Reg FD (which stands for “Fair Disclosure”) prohibits companies from selectively disclosing material nonpublic information to certain categories of individuals, including analysts and investors, and is intended to promote full and fair disclosure of such information in order to ensure that all investors have equal access to potential market-moving information.
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SEC Disclosure and Proxy Guidance and Proposals
The following post was originally included as part of our recently published memorandum “Selected Issues for Boards of Directors in 2020”.
SEC Disclosure and Reporting Developments
Recently, the US Securities and Exchange Commission continued to move forward with a number of disclosure effectiveness and simplification initiatives, the details of which are available in…
The Tesla Settlement – What It Means for Other Companies
There have been plenty of press reports about the SEC’s settlement with Elon Musk arising from his tweeting about taking Tesla private. But the concurrent settlement with Tesla itself provides interesting lessons for disclosure and governance at public companies.
Tesla agreed to pay a $20 million penalty and agreed to several “undertakings” to strengthen its governance and controls including a requirement that it add two independent directors to its Board. And, under his own settlement, Musk agreed to step down for three years as chairman of the Board of Directors, although he is allowed to continue as CEO. …
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