White Collar Roundup (June 2012)

Author:Day Pitney LLP's White Collar Defense And Internal Investigations Practice
Profession:Day Pitney LLP

For Bankruptcy Fraud, It's Not Material

Misstatements in bankruptcy filings need not be material to run afoul of 18 U.S.C. 1519, according to this opinion from the U.S. Court of Appeals for the Fourth Circuit. Section 1519 makes it a crime to knowingly make a false entry in any record with the intent to "impede, obstruct, or influence" the administration of a bankruptcy filing. In the case, the trial court refused to instruct the jury that materiality was an element of a violation of § 1519. After he was convicted of violating that statute, the defendant appealed, claiming the trial court had erred by refusing to give the instruction. The Fourth Circuit affirmed, holding that the plain language of the statute did not include any element of materiality. Just the "Cost of Doing Business" At a hearing before the House Financial Services Committee, several representatives expressed concerns about the Securities and Exchange Commission's (SEC) practice of entering settlements with accused violators of its regulations without any admission or denial of liability. Representative Carolyn Maloney, D-New York, said these settlements risked becoming simply the "cost of doing business," which would eviscerate the function of the SEC. While Rep. Maloney was joined by other Democratic lawmakers in criticizing the SEC, several Republican committee members rebuffed any effort to second-guess the SEC's discretion to settle cases. To watch the hearing, dim the lights and click here.

The Benefits of 20/20 Vision

Chairman Mary L. Schapiro of the SEC spoke at a meeting of over-the-counter (OTC) derivatives regulators to push for transparency in the derivatives market. Chairman Schapiro focused the discussion "on the benefits and costs of post-trade transparency requirements for all OTC derivatives transactions, whether or not execution occurs on an exchange or electronic trading platform." For an outline of her talking points, click here.

To the Cloud

The International Working Group on Data Protection in Telecommunications has issued a working paper on cloud computing to address some pitfalls and to make some recommendations regarding privacy, data protection and other legal issues facing companies moving to leverage cloud computing. The paper outlines six general recommendations and 44 best practices for moving data to the cloud. A Different Kind of Healthcare Debate A provision of the Health Insurance Portability and Accountability Act of 1996...

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