FROM: U.S. ENVIRONMENTAL PROTECTION AGENCY
EPA Strengthens Conflict of Interest Review Process for Science Review Panels
WASHINGTON — The U.S Environmental Protection Agency (EPA) today announced that it has improved its conflict of interest review process for contractor-managed peer reviews. EPA has put a new oversight process in place to ensure that contractors follow all existing conflicts of interest guidance and requirements. In addition, EPA will now ensure that the public has the opportunity to review and comment on a peer review panel’s composition when influential scientific documents are being considered.
"We are committed to scientific integrity at EPA," said EPA Acting Administrator Bob Perciasepe. "Improving the contract-managed peer review process and increasing transparency will lead to stronger science at the agency."
This revised process will apply to all future technical documents designated as Influential Scientific Information or Highly Influential Scientific Assessments where independent peer reviews will be conducted by panels selected and managed by independent contractors. For future peer review panels, EPA will now publish the names, principal affiliations and resumes of candidates being considered for the panel. Members of the public will be able to provide comments on the candidates for a period of at least three weeks.
After selecting the final peer review panel, the contractor will consult with EPA to review whether the contractor followed existing conflicts of interest guidance and requirements, and identify and provide input on any issues. In addition, the names of the final peer review panel members will be posted publicly before the meeting takes place. This process will ensure that existing conflicts of interest guidance and requirements are applied correctly and where a potential conflict of interest is identified, allow EPA to determine whether the contractor’s plan to address the conflict is acceptable. The new process does not change EPA’s existing standards for determining conflicts of interest.
Saturday, May 4, 2013
Friday, May 3, 2013
ACTIONS ANNOUNCED FOR VIOLATIONS OF LEAD RENOVATION, REPAIR AND PAINTING RULE
FROM: ENVIRONMENTAL PROTECTION AGENCY
EPA Takes Action Against Violators of the Lead Renovation, Repair and Painting Rule
WASHINGTON – Today, EPA announced 17 enforcement actions for violations of the Lead Renovation, Repair and Painting rule (RRP).
The RRP rule protects homeowners and tenants from dangerous lead dust that can be left behind after common renovation, repair, and painting work. It requires that contractors and subcontractors be properly trained and certified, and use lead-safe work practices to ensure that lead dust is minimized. Lead exposure can cause a range of health effects, from behavioral problems and learning disabilities to seizures and death, putting young children at the greatest risk because their nervous systems are still developing.
"Using lead-safe work practices is good business and it’s the law," said Cynthia Giles, assistant administrator for EPA’s Office of Enforcement and Compliance Assurance. "EPA is taking action to enforce lead rules to protect people from exposure to lead and to ensure a level playing field for contractors that follow the rules."
The enforcement actions address serious violations of the RRP rule, including fourteen actions where the contractor failed to obtain certification prior to performing or offering to perform renovation activities on pre-1978 homes, where lead is more likely to be present. Other alleged violations included failure to follow the lead-safe work practices, which are critical to reducing exposure to lead-based paint hazards.
The 17 enforcement actions listed below include 14 administrative settlements assessing civil penalties of up to $23,000. These settlements also required the contractors to certify that they had come into compliance with the requirements of the RRP rule. Additionally, EPA filed three administrative complaints seeking civil penalties of up to the statutory maximum of $37,500 per violation. As required by the Toxic Substances Control Act, a company or individual’s ability to pay a penalty is evaluated and penalties are adjusted accordingly.
Enforcement actions:
• Groeller Painting, Inc. of St. Louis, Missouri.
• Albracht Permasiding and Window, Co. of Omaha, Nebraska.
• Midwest College Painters, LLC of Bloomfield Hills, Michigan.
• ARK Property Investments, LLC of Richmond, Indiana.
• Henderson & Associates Services of Largo, Florida.
• Home Resources Management, LLC of Columbia, Tennessee.
• Camaj Interiors & Exteriors of Jacksonville, Florida.
• Cherokee Home Improvements, LLC of Church Creek, Maryland.
• Window World of Harford located in Belair, Maryland.
• EA Construction and General Contracting of West Chester, Pennsylvania.
• Roman Builders of Morton, Pennsylvania.
• Accolade Construction Group, Inc. of New York, New York.
• PZ Painting of Springfield, New Jersey.
• Creative Renovations of Brooklyn, New York.
• Reeson Construction of Webster, New Hampshire.
• New Hampshire Plate Glass Corporation of Portsmouth, New Hampshire.
• CM Rogers Handyman of Manchester, New Hampshire.
EPA Takes Action Against Violators of the Lead Renovation, Repair and Painting Rule
WASHINGTON – Today, EPA announced 17 enforcement actions for violations of the Lead Renovation, Repair and Painting rule (RRP).
The RRP rule protects homeowners and tenants from dangerous lead dust that can be left behind after common renovation, repair, and painting work. It requires that contractors and subcontractors be properly trained and certified, and use lead-safe work practices to ensure that lead dust is minimized. Lead exposure can cause a range of health effects, from behavioral problems and learning disabilities to seizures and death, putting young children at the greatest risk because their nervous systems are still developing.
"Using lead-safe work practices is good business and it’s the law," said Cynthia Giles, assistant administrator for EPA’s Office of Enforcement and Compliance Assurance. "EPA is taking action to enforce lead rules to protect people from exposure to lead and to ensure a level playing field for contractors that follow the rules."
The enforcement actions address serious violations of the RRP rule, including fourteen actions where the contractor failed to obtain certification prior to performing or offering to perform renovation activities on pre-1978 homes, where lead is more likely to be present. Other alleged violations included failure to follow the lead-safe work practices, which are critical to reducing exposure to lead-based paint hazards.
The 17 enforcement actions listed below include 14 administrative settlements assessing civil penalties of up to $23,000. These settlements also required the contractors to certify that they had come into compliance with the requirements of the RRP rule. Additionally, EPA filed three administrative complaints seeking civil penalties of up to the statutory maximum of $37,500 per violation. As required by the Toxic Substances Control Act, a company or individual’s ability to pay a penalty is evaluated and penalties are adjusted accordingly.
Enforcement actions:
• Groeller Painting, Inc. of St. Louis, Missouri.
• Albracht Permasiding and Window, Co. of Omaha, Nebraska.
• Midwest College Painters, LLC of Bloomfield Hills, Michigan.
• ARK Property Investments, LLC of Richmond, Indiana.
• Henderson & Associates Services of Largo, Florida.
• Home Resources Management, LLC of Columbia, Tennessee.
• Camaj Interiors & Exteriors of Jacksonville, Florida.
• Cherokee Home Improvements, LLC of Church Creek, Maryland.
• Window World of Harford located in Belair, Maryland.
• EA Construction and General Contracting of West Chester, Pennsylvania.
• Roman Builders of Morton, Pennsylvania.
• Accolade Construction Group, Inc. of New York, New York.
• PZ Painting of Springfield, New Jersey.
• Creative Renovations of Brooklyn, New York.
• Reeson Construction of Webster, New Hampshire.
• New Hampshire Plate Glass Corporation of Portsmouth, New Hampshire.
• CM Rogers Handyman of Manchester, New Hampshire.
Thursday, May 2, 2013
PHILADELPHIA BANK SETTLES DECEPTIVE PRACTICES CHARGES WITH FDIC
FROM: U.S. FEDERAL DEPOSIT INSURANCE CORPORATION
FDIC Announces Settlement With Citizens Bank of Pennsylvania, Philadelphia, Pennsylvania, for Deceptive Practices
The Federal Deposit Insurance Corporation (FDIC) announced a settlement with Citizens Bank of Pennsylvania, Philadelphia, Pennsylvania (CBPA), for deceptive practices in violation of Section 5 of the Federal Trade Commission Act (Section 5). Under the settlement, CBPA has agreed to an Order for Restitution and Order to Pay Civil Money Penalty (Order). The Order requires CBPA to pay a civil money penalty of $5.0 million and provide restitution of approximately $1.4 million to more than 75,000 affected consumers.
The FDIC determined that CBPA engaged in deceptive practices in violation of Section 5 in the marketing and implementation of its overdraft payment program, checking rewards programs, and stop-payment process for preauthorized recurring electronic funds transfer. The Order, in part, requires CBPA to correct the violations of law, ensure future compliance, and prepare and implement a comprehensive restitution plan for all consumers adversely affected by the violations. The restitution timeframe extends between January 2008 and November 2011. CBPA will send reimbursements without requiring any action by affected consumers.
This action is being taken in coordination with the separate action of the Office of the Comptroller of the Currency against RBS Citizens, N.A., an affiliate of CBPA, for similar violations of Section 5 of the FTC Act.
In agreeing to the issuance of the Order, CBPA does not admit or deny any liability. A copy of the FDIC's Order issued against CBPA is attached.
FDIC Announces Settlement With Citizens Bank of Pennsylvania, Philadelphia, Pennsylvania, for Deceptive Practices
The Federal Deposit Insurance Corporation (FDIC) announced a settlement with Citizens Bank of Pennsylvania, Philadelphia, Pennsylvania (CBPA), for deceptive practices in violation of Section 5 of the Federal Trade Commission Act (Section 5). Under the settlement, CBPA has agreed to an Order for Restitution and Order to Pay Civil Money Penalty (Order). The Order requires CBPA to pay a civil money penalty of $5.0 million and provide restitution of approximately $1.4 million to more than 75,000 affected consumers.
The FDIC determined that CBPA engaged in deceptive practices in violation of Section 5 in the marketing and implementation of its overdraft payment program, checking rewards programs, and stop-payment process for preauthorized recurring electronic funds transfer. The Order, in part, requires CBPA to correct the violations of law, ensure future compliance, and prepare and implement a comprehensive restitution plan for all consumers adversely affected by the violations. The restitution timeframe extends between January 2008 and November 2011. CBPA will send reimbursements without requiring any action by affected consumers.
This action is being taken in coordination with the separate action of the Office of the Comptroller of the Currency against RBS Citizens, N.A., an affiliate of CBPA, for similar violations of Section 5 of the FTC Act.
In agreeing to the issuance of the Order, CBPA does not admit or deny any liability. A copy of the FDIC's Order issued against CBPA is attached.
CORPORATE EXECUTIVE SENTENCED TO PRISION FOR ROLE IN LCD PRICE-FIXING CONSPIRACY
FROM: U.S. DEPARTMENT OF JUSTICE
WASHINGTON — An executive of AU Optronics Corp., a Taiwan-based liquid crystal display (LCD) producer, was sentenced today in U.S. District Court in San Francisco for his participation in a worldwide thin-film transistor-liquid crystal display (TFT-LCD) price-fixing conspiracy. Shiu Lung Leung, AU Optronics Corp.’s former senior manager in its Desktop Display Business Group, was sentenced to serve 24 months in prison and to pay a $50,000 criminal fine, the Department of Justice announced.
AU Optronics Corp., based in Hsinchu, Taiwan, and its American subsidiary, AU Optronics Corp. America, headquartered in Milpitas, Calif., were found guilty in March 2012, for their participation in the price-fixing conspiracy, following an eight-week trial. Former AU Optronics Corp. president Hsuan Bin Chen and former AU Optronics Corp. executive vice president Hui Hsiung were also found guilty at that time. A mistrial was declared against Leung after that trial. Today’s sentencing took place before Judge Susan Illston and follows a three-week retrial that started in November 2012 and resulted in Leung’s conviction.
"These international price-fixers caused consumers to pay inflated prices for their computer monitors, notebook computers and televisions," said Assistant Attorney General Bill Baer in charge of the Department of Justice’s Antitrust Division. "Prison sentences for culpable executives, combined with substantial fines against corporate wrongdoers, are the most effective deterrents for protecting consumers from this kind of illegal cartel behavior."
The indictment charged that AU Optronics Corp. participated in the worldwide price-fixing conspiracy from Sept. 14, 2001, to Dec. 1, 2006, and that its subsidiary joined the conspiracy as early as spring 2003. The indictment further charged that Leung participated in that conspiracy from May 15, 2002 to Dec. 1, 2006. LCD panels affected by the conspiracy were a major component in flat-panel computer monitors, notebook computers, and flat-screen televisions sold in the United States. The conspirators fixed the prices of LCD panels during monthly meetings with their competitors, which were secretly held in hotel conference rooms, karaoke bars and tea rooms around Taiwan.
Eight companies have been convicted of charges arising out of the department’s ongoing investigation and have been sentenced to pay criminal fines totaling $1.39 billion. All together, 22 executives have been charged. Including today’s sentence, 13 executives have been convicted and have been sentenced to serve prison terms ranging from six to 36 months.
Today’s charges are the result of a joint investigation by the Department of Justice Antitrust Division’s San Francisco office and the FBI in San Francisco.
WASHINGTON — An executive of AU Optronics Corp., a Taiwan-based liquid crystal display (LCD) producer, was sentenced today in U.S. District Court in San Francisco for his participation in a worldwide thin-film transistor-liquid crystal display (TFT-LCD) price-fixing conspiracy. Shiu Lung Leung, AU Optronics Corp.’s former senior manager in its Desktop Display Business Group, was sentenced to serve 24 months in prison and to pay a $50,000 criminal fine, the Department of Justice announced.
AU Optronics Corp., based in Hsinchu, Taiwan, and its American subsidiary, AU Optronics Corp. America, headquartered in Milpitas, Calif., were found guilty in March 2012, for their participation in the price-fixing conspiracy, following an eight-week trial. Former AU Optronics Corp. president Hsuan Bin Chen and former AU Optronics Corp. executive vice president Hui Hsiung were also found guilty at that time. A mistrial was declared against Leung after that trial. Today’s sentencing took place before Judge Susan Illston and follows a three-week retrial that started in November 2012 and resulted in Leung’s conviction.
"These international price-fixers caused consumers to pay inflated prices for their computer monitors, notebook computers and televisions," said Assistant Attorney General Bill Baer in charge of the Department of Justice’s Antitrust Division. "Prison sentences for culpable executives, combined with substantial fines against corporate wrongdoers, are the most effective deterrents for protecting consumers from this kind of illegal cartel behavior."
The indictment charged that AU Optronics Corp. participated in the worldwide price-fixing conspiracy from Sept. 14, 2001, to Dec. 1, 2006, and that its subsidiary joined the conspiracy as early as spring 2003. The indictment further charged that Leung participated in that conspiracy from May 15, 2002 to Dec. 1, 2006. LCD panels affected by the conspiracy were a major component in flat-panel computer monitors, notebook computers, and flat-screen televisions sold in the United States. The conspirators fixed the prices of LCD panels during monthly meetings with their competitors, which were secretly held in hotel conference rooms, karaoke bars and tea rooms around Taiwan.
Eight companies have been convicted of charges arising out of the department’s ongoing investigation and have been sentenced to pay criminal fines totaling $1.39 billion. All together, 22 executives have been charged. Including today’s sentence, 13 executives have been convicted and have been sentenced to serve prison terms ranging from six to 36 months.
Today’s charges are the result of a joint investigation by the Department of Justice Antitrust Division’s San Francisco office and the FBI in San Francisco.
Wednesday, May 1, 2013
STATE DEPARTMENT, RAYTHEON REACH AGREEMENT REGARDING VIOLATIONS OF ARMS EXPORT CONTROL ACT
FROM: U.S. STATE DEPARTMENT
State Department Announces Resolution of Raytheon Company Arms Export Control Enforcement Case
Media Note
Office of the Spokesperson
Washington, DC
April 30, 2013
The State Department has reached administrative agreement with Raytheon Company (Raytheon) following an extensive enforcement review to address hundreds of civil violations of the Arms Export Control Act (AECA) and the International Traffic in Arms Regulations (ITAR). Raytheon will pay $8 million in civil penalties and remedial expenditures to resolve these alleged violations. This settlement highlights the role of the Department in protecting sensitive American technologies from unauthorized use by ensuring compliance with substantive and administrative arms export restrictions.
The Department’s Office of Defense Trade Controls Compliance in the Bureau of Political-Military Affairs determined that Raytheon’s numerous violations demonstrated a recurring, corporate-wide weakness in maintaining effective ITAR controls. Over the course of many years, Raytheon business units have disclosed to the Department hundreds of ITAR violations, largely consisting of failures to properly manage Department-authorized agreements and temporary import and export authorizations. The violations included inaccurate tracking, valuation and documentation of temporary exports and imports of controlled hardware, manufacture of such hardware by Raytheon’s foreign partners in excess of the approved amounts, and failures to timely obtain and submit required documents. Raytheon repeatedly discovered and disclosed such violations to the Department, in some cases finding that previously reported remedial measures failed to prevent or detect additional similar violations subsequently disclosed.
Under the terms of a four year Consent Agreement with the Department, Raytheon will pay a civil penalty of $8 million. The State Department agreed to suspend $4 million of this amount on the condition that the funds have or will be used for Department-approved pre- and post-Consent Agreement remedial compliance measures. In addition, an external Special Compliance Official will be engaged by Raytheon to oversee the Consent Agreement, which will also require the company to conduct two external audits of its compliance program during the Agreement term as well as implement additional compliance measures.
Raytheon disclosed nearly all of the ITAR violations resolved in this settlement voluntarily to the Department, acknowledged their serious nature, cooperated with Department reviews, and implemented or has planned extensive remedial measures. For these reasons, the Department has determined that an administrative debarment of Raytheon is not appropriate at this time.
State Department Announces Resolution of Raytheon Company Arms Export Control Enforcement Case
Media Note
Office of the Spokesperson
Washington, DC
April 30, 2013
The State Department has reached administrative agreement with Raytheon Company (Raytheon) following an extensive enforcement review to address hundreds of civil violations of the Arms Export Control Act (AECA) and the International Traffic in Arms Regulations (ITAR). Raytheon will pay $8 million in civil penalties and remedial expenditures to resolve these alleged violations. This settlement highlights the role of the Department in protecting sensitive American technologies from unauthorized use by ensuring compliance with substantive and administrative arms export restrictions.
The Department’s Office of Defense Trade Controls Compliance in the Bureau of Political-Military Affairs determined that Raytheon’s numerous violations demonstrated a recurring, corporate-wide weakness in maintaining effective ITAR controls. Over the course of many years, Raytheon business units have disclosed to the Department hundreds of ITAR violations, largely consisting of failures to properly manage Department-authorized agreements and temporary import and export authorizations. The violations included inaccurate tracking, valuation and documentation of temporary exports and imports of controlled hardware, manufacture of such hardware by Raytheon’s foreign partners in excess of the approved amounts, and failures to timely obtain and submit required documents. Raytheon repeatedly discovered and disclosed such violations to the Department, in some cases finding that previously reported remedial measures failed to prevent or detect additional similar violations subsequently disclosed.
Under the terms of a four year Consent Agreement with the Department, Raytheon will pay a civil penalty of $8 million. The State Department agreed to suspend $4 million of this amount on the condition that the funds have or will be used for Department-approved pre- and post-Consent Agreement remedial compliance measures. In addition, an external Special Compliance Official will be engaged by Raytheon to oversee the Consent Agreement, which will also require the company to conduct two external audits of its compliance program during the Agreement term as well as implement additional compliance measures.
Raytheon disclosed nearly all of the ITAR violations resolved in this settlement voluntarily to the Department, acknowledged their serious nature, cooperated with Department reviews, and implemented or has planned extensive remedial measures. For these reasons, the Department has determined that an administrative debarment of Raytheon is not appropriate at this time.
Tuesday, April 30, 2013
LEVEL GLOBAL WILL PAY $21.5 MILLION TO SETTLE SEC CHARGES OF INSIDER TRADING
FROM: U.S. SECURITIES AND EXCHANGE COMMISSION
Level Global Agrees to Pay More Than $21.5 million to Settle SEC Insider Trading Charges
Washington, D.C., April 29, 2013 — The Securities and Exchange Commission today announced that Greenwich, Conn.-based hedge fund advisory firm Level Global Investors LP has agreed to pay more than $21.5 million to settle charges that its co-founder, who also served as a portfolio manager, and its analyst engaged in repeated insider trading in the securities of Dell Inc. and Nvidia Corp.
In January 2012, the SEC filed insider trading charges against Level Global, the firm's co-founder Anthony Chiasson, a former analyst Spyridon "Sam" Adondakis, and six other defendants, including five investment professionals and the hedge fund advisory firm Diamondback Capital Management.
The SEC's complaint, filed in federal court in Manhattan, alleged that Adondakis was a member of a group of closely associated hedge fund analysts who illegally obtained highly sensitive information regarding the financial performance of Dell and Nvidia before this information was made public. The illegally obtained information involved Dell and Nvidia's revenues and profit margins and sometimes indicated that the tech companies' quarterly results would differ significantly from the consensus expectations of Wall Street analysts.
According to the SEC, during 2008 and 2009, Adondakis passed the information on to Chiasson, who used it to execute trades on behalf of hedge funds managed by Level Global and reap millions of dollars in illegal profits. In 2011, following news reports of the government's investigation, Level Global, which had once managed as much as $4 billion, announced that it would close its business and begin returning money to its investors. It is presently in the process of winding down its business.
"The insider trading at Level Global was hardly an isolated event - it occurred repeatedly, and involved multiple companies and multiple quarterly announcements," said Sanjay Wadhwa, Senior Associate Director of the SEC's New York Regional Office. "This settlement serves as another reminder that the SEC will hold hedge fund managers accountable when their employees violate the securities laws."
The settlement with Level Global, which is subject to court approval, requires the firm to disgorge $10,082,725 in fees that it reaped from the alleged insider-trading scheme, to pay prejudgment interest of $1,348,824, and to pay a penalty of $10,082,725. Level Global has also agreed to the entry of an order permanently enjoining the firm from future violations of Section 10(b) of the Securities Exchange Act of 1934, Rule 10b-5, and Section 17(a) of the Securities Act of 1933.
Level Global neither admits nor denies the SEC's allegations. Adondakis previously pleaded guilty to parallel criminal charges and agreed to a settlement with the SEC in which he admitted liability for insider trading. The SEC is continuing to pursue its insider trading claims against the firm's co-founder Chiasson, who was convicted in December 2012 of securities fraud in a parallel criminal proceeding.
The SEC's investigation, which is continuing, has been conducted by Daniel Marcus, Stephen Larson, and Joseph Sansone - members of the SEC's Market Abuse Unit in New York - and Matthew Watkins, Justin Smith, Neil Hendelman, Diego Brucculeri and James D'Avino of the New York Regional Office. It has been supervised by Sanjay Wadhwa. The SEC thanks the U.S. Attorney's Office for the Southern District of New York and the Federal Bureau of Investigation for their assistance in the matter.
Level Global Agrees to Pay More Than $21.5 million to Settle SEC Insider Trading Charges
Washington, D.C., April 29, 2013 — The Securities and Exchange Commission today announced that Greenwich, Conn.-based hedge fund advisory firm Level Global Investors LP has agreed to pay more than $21.5 million to settle charges that its co-founder, who also served as a portfolio manager, and its analyst engaged in repeated insider trading in the securities of Dell Inc. and Nvidia Corp.
In January 2012, the SEC filed insider trading charges against Level Global, the firm's co-founder Anthony Chiasson, a former analyst Spyridon "Sam" Adondakis, and six other defendants, including five investment professionals and the hedge fund advisory firm Diamondback Capital Management.
The SEC's complaint, filed in federal court in Manhattan, alleged that Adondakis was a member of a group of closely associated hedge fund analysts who illegally obtained highly sensitive information regarding the financial performance of Dell and Nvidia before this information was made public. The illegally obtained information involved Dell and Nvidia's revenues and profit margins and sometimes indicated that the tech companies' quarterly results would differ significantly from the consensus expectations of Wall Street analysts.
According to the SEC, during 2008 and 2009, Adondakis passed the information on to Chiasson, who used it to execute trades on behalf of hedge funds managed by Level Global and reap millions of dollars in illegal profits. In 2011, following news reports of the government's investigation, Level Global, which had once managed as much as $4 billion, announced that it would close its business and begin returning money to its investors. It is presently in the process of winding down its business.
"The insider trading at Level Global was hardly an isolated event - it occurred repeatedly, and involved multiple companies and multiple quarterly announcements," said Sanjay Wadhwa, Senior Associate Director of the SEC's New York Regional Office. "This settlement serves as another reminder that the SEC will hold hedge fund managers accountable when their employees violate the securities laws."
The settlement with Level Global, which is subject to court approval, requires the firm to disgorge $10,082,725 in fees that it reaped from the alleged insider-trading scheme, to pay prejudgment interest of $1,348,824, and to pay a penalty of $10,082,725. Level Global has also agreed to the entry of an order permanently enjoining the firm from future violations of Section 10(b) of the Securities Exchange Act of 1934, Rule 10b-5, and Section 17(a) of the Securities Act of 1933.
Level Global neither admits nor denies the SEC's allegations. Adondakis previously pleaded guilty to parallel criminal charges and agreed to a settlement with the SEC in which he admitted liability for insider trading. The SEC is continuing to pursue its insider trading claims against the firm's co-founder Chiasson, who was convicted in December 2012 of securities fraud in a parallel criminal proceeding.
The SEC's investigation, which is continuing, has been conducted by Daniel Marcus, Stephen Larson, and Joseph Sansone - members of the SEC's Market Abuse Unit in New York - and Matthew Watkins, Justin Smith, Neil Hendelman, Diego Brucculeri and James D'Avino of the New York Regional Office. It has been supervised by Sanjay Wadhwa. The SEC thanks the U.S. Attorney's Office for the Southern District of New York and the Federal Bureau of Investigation for their assistance in the matter.
Monday, April 29, 2013
ICN STRIVES TO ADVANCE INTERNATIONAL COMPETITION
FROM: U.S. DEPARTMENT OF JUSTICE
INTERNATIONAL COMPETITION NETWORK ADVANCES
CONVERGENCE THROUGH INITIATIVES ON
ENFORCEMENT COOPERATION AND INVESTIGATIVE PROCESS
WASHINGTON — The International Competition Network (ICN) advanced convergence through important initiatives on international enforcement cooperation and investigative processes in competition cases, the Department of Justice announced today. The ICN adopted new work product on economic analysis in merger review, legal theories in exclusive dealing investigations, international cooperation and information sharing in cartel enforcement, and the benefits of competition.
The 12th annual ICN conference, hosted by Poland’s Office of Competition and Consumer Protection (OCCP), was held on April 24-26, 2013, in Warsaw, Poland. More than 500 delegates participated, representing more than 80 antitrust agencies from around the world, including competition experts from international organizations and the legal, business, consumer and academic communities. Assistant Attorney General Bill Baer of the Department of Justice’s Antitrust Division and Federal Trade Commission (FTC) Chairwoman Edith Ramirez led the U.S. delegation. The conference showcased the achievements of ICN working groups on cartels, competition advocacy, competition agency effectiveness, mergers and unilateral conduct.
"One of the defining characteristics of the ICN is the deep engagement of its members on critical antitrust issues, including mergers, anti-cartel enforcement, unilateral conduct and competition advocacy," said Assistant Attorney General Baer. "The discussions and work product emerging from this meeting strengthen the ties between U.S. enforcers and our counterparts around the globe and enhance effective antitrust enforcement for the benefit of all consumers."
Bronislaw Komorowski, the President of Poland, provided opening remarks at the conference. John Fingleton, former Chief Executive of the UK Office of Fair Trading and former ICN Steering Group Chair, moderated a panel on competition and its relevance to global economic policy discussion among representatives from the World Trade Organization, World Bank and International Chamber of Commerce. Joaquin Almunia, European Commission Vice President and Commissioner for Competition, also addressed the conference. Eduardo Pérez Motta, ICN Steering Group Chair and President of the Mexican Federal Competition Commission, spoke about his initiatives to support ICN member competition advocacy and enhance cooperation with international organizations.
Assistant Attorney General Baer moderated a panel of antitrust officials on international enforcement cooperation to discuss the strengths and limitations of current cooperation frameworks. The panel also discussed future ICN work that could best help antitrust agencies address the challenges of engaging effectively in international enforcement cooperation. Over the past year, the ICN partnered with the Organization for Economic Cooperation and Development (OECD)’s Competition Committee on a comprehensive study of the state of international enforcement cooperation. Lynda K. Marshall, Assistant Chief of the Department of Justice’s Antitrust Division’s Foreign Commerce Section, led a discussion on future work on international cooperation in cartel enforcement.
The Polish OCCP led a special project devoted to the interaction between competition agencies and courts, culminating in a session led by OCCP President Malgorzata Krasnodebska-Tomkiel. FTC Chairwoman Ramirez addressed the vital role of economic evidence in competition cases and offered guidance for how to effectively present this evidence to generalist courts. She also highlighted the various tools available to competition agencies to encourage courts to recognize competition law principles.
"This 12th annual ICN conference demonstrated how competition agencies from around the world can come together both to advance convergence toward best practices in antitrust enforcement and to strengthen the voice of competition policy as our governments confront common economic challenges," said Chairwoman Ramirez.
The conference also highlighted the work of the Cartel Working Group, co-chaired by the Department of Justice, the Japan Fair Trade Commission and Germany’s Bundeskartellamt. The working group brings together antitrust enforcers to address the challenges of anti-cartel enforcement, through the examination of important policy issues and the exchange of effective investigative techniques. The group presented a new chapter on international cooperation and information sharing for its Anti-Cartel Enforcement Manual, a reference tool for antitrust agencies on effective investigative techniques.
The Agency Effectiveness Working Group, co-chaired by the FTC, the Mexican Federal Competition Commission and the Norwegian Competition Authority, examines the institutions and procedures that support the enforcement missions of competition agencies. Randolph W. Tritell, Director of the FTC’s Office of International Affairs, led a panel discussion and presentation of the group’s work related to investigative tools and agency transparency practices, part of a project on investigative processes in competition cases. The working group also presented two new chapters on effective knowledge management and human resources management for its competition agency practice manual.
The conference showcased the ICN Curriculum Project, a project led by the FTC to create a "virtual university" of training materials on competition law and practice. FTC Counsel Paul O’Brien presented the Curriculum Project and its new modules on planning and conducting investigations, competition advocacy and challenges for agencies in developing countries.
The Merger Working Group, co-chaired by the European Commission’s Competition Directorate, the Competition Commission of India (CCI) and the Italian Competition Authority aims to promote best practices in the design and operation of merger review regimes. The FTC’s Director of the Bureau of Economics, Howard Shelanski, participated in a panel discussion of the role of economic analysis in merger review. The panel highlighted the group’s new work addressing the role of economic evidence in merger analysis, a comprehensive overview of the qualitative and quantitative analyses available to antitrust agencies for the review of horizontal mergers.
The Unilateral Conduct Working Group, co-chaired by the Swedish Competition Authority, the Turkish Competition Authority, and the UK Office of Fair Trading, promotes convergence and sound enforcement of laws governing conduct by firms with substantial market power. The working group presented a new workbook chapter on exclusive dealing arrangements as part of a project that is producing a practical guide to the investigation of the various types of unilateral conduct.
The Advocacy Working Group, co-chaired by the French Autorité de la Concurrence, the Portuguese Competition Authority and the Competition Commission of Mauritius, develops practical tools and guidance to improve the effectiveness of ICN members’ competition advocacy. This year, the working group developed draft guidance on procedures and analysis for assessing existing or proposed laws and regulations to determine whether they may have a significant impact on competition. The group also presented its work on practical techniques to help promote a competition culture and strategies for explaining the benefits of competition to other government entities.
The ICN was created in October 2001, when the Department of Justice and the FTC joined antitrust agencies from 13 other jurisdictions to increase understanding of competition policy and promote convergence toward best practices around the world. The ICN now includes 126 member agencies from 111 jurisdictions.
INTERNATIONAL COMPETITION NETWORK ADVANCES
CONVERGENCE THROUGH INITIATIVES ON
ENFORCEMENT COOPERATION AND INVESTIGATIVE PROCESS
WASHINGTON — The International Competition Network (ICN) advanced convergence through important initiatives on international enforcement cooperation and investigative processes in competition cases, the Department of Justice announced today. The ICN adopted new work product on economic analysis in merger review, legal theories in exclusive dealing investigations, international cooperation and information sharing in cartel enforcement, and the benefits of competition.
The 12th annual ICN conference, hosted by Poland’s Office of Competition and Consumer Protection (OCCP), was held on April 24-26, 2013, in Warsaw, Poland. More than 500 delegates participated, representing more than 80 antitrust agencies from around the world, including competition experts from international organizations and the legal, business, consumer and academic communities. Assistant Attorney General Bill Baer of the Department of Justice’s Antitrust Division and Federal Trade Commission (FTC) Chairwoman Edith Ramirez led the U.S. delegation. The conference showcased the achievements of ICN working groups on cartels, competition advocacy, competition agency effectiveness, mergers and unilateral conduct.
"One of the defining characteristics of the ICN is the deep engagement of its members on critical antitrust issues, including mergers, anti-cartel enforcement, unilateral conduct and competition advocacy," said Assistant Attorney General Baer. "The discussions and work product emerging from this meeting strengthen the ties between U.S. enforcers and our counterparts around the globe and enhance effective antitrust enforcement for the benefit of all consumers."
Bronislaw Komorowski, the President of Poland, provided opening remarks at the conference. John Fingleton, former Chief Executive of the UK Office of Fair Trading and former ICN Steering Group Chair, moderated a panel on competition and its relevance to global economic policy discussion among representatives from the World Trade Organization, World Bank and International Chamber of Commerce. Joaquin Almunia, European Commission Vice President and Commissioner for Competition, also addressed the conference. Eduardo Pérez Motta, ICN Steering Group Chair and President of the Mexican Federal Competition Commission, spoke about his initiatives to support ICN member competition advocacy and enhance cooperation with international organizations.
Assistant Attorney General Baer moderated a panel of antitrust officials on international enforcement cooperation to discuss the strengths and limitations of current cooperation frameworks. The panel also discussed future ICN work that could best help antitrust agencies address the challenges of engaging effectively in international enforcement cooperation. Over the past year, the ICN partnered with the Organization for Economic Cooperation and Development (OECD)’s Competition Committee on a comprehensive study of the state of international enforcement cooperation. Lynda K. Marshall, Assistant Chief of the Department of Justice’s Antitrust Division’s Foreign Commerce Section, led a discussion on future work on international cooperation in cartel enforcement.
The Polish OCCP led a special project devoted to the interaction between competition agencies and courts, culminating in a session led by OCCP President Malgorzata Krasnodebska-Tomkiel. FTC Chairwoman Ramirez addressed the vital role of economic evidence in competition cases and offered guidance for how to effectively present this evidence to generalist courts. She also highlighted the various tools available to competition agencies to encourage courts to recognize competition law principles.
"This 12th annual ICN conference demonstrated how competition agencies from around the world can come together both to advance convergence toward best practices in antitrust enforcement and to strengthen the voice of competition policy as our governments confront common economic challenges," said Chairwoman Ramirez.
The conference also highlighted the work of the Cartel Working Group, co-chaired by the Department of Justice, the Japan Fair Trade Commission and Germany’s Bundeskartellamt. The working group brings together antitrust enforcers to address the challenges of anti-cartel enforcement, through the examination of important policy issues and the exchange of effective investigative techniques. The group presented a new chapter on international cooperation and information sharing for its Anti-Cartel Enforcement Manual, a reference tool for antitrust agencies on effective investigative techniques.
The Agency Effectiveness Working Group, co-chaired by the FTC, the Mexican Federal Competition Commission and the Norwegian Competition Authority, examines the institutions and procedures that support the enforcement missions of competition agencies. Randolph W. Tritell, Director of the FTC’s Office of International Affairs, led a panel discussion and presentation of the group’s work related to investigative tools and agency transparency practices, part of a project on investigative processes in competition cases. The working group also presented two new chapters on effective knowledge management and human resources management for its competition agency practice manual.
The conference showcased the ICN Curriculum Project, a project led by the FTC to create a "virtual university" of training materials on competition law and practice. FTC Counsel Paul O’Brien presented the Curriculum Project and its new modules on planning and conducting investigations, competition advocacy and challenges for agencies in developing countries.
The Merger Working Group, co-chaired by the European Commission’s Competition Directorate, the Competition Commission of India (CCI) and the Italian Competition Authority aims to promote best practices in the design and operation of merger review regimes. The FTC’s Director of the Bureau of Economics, Howard Shelanski, participated in a panel discussion of the role of economic analysis in merger review. The panel highlighted the group’s new work addressing the role of economic evidence in merger analysis, a comprehensive overview of the qualitative and quantitative analyses available to antitrust agencies for the review of horizontal mergers.
The Unilateral Conduct Working Group, co-chaired by the Swedish Competition Authority, the Turkish Competition Authority, and the UK Office of Fair Trading, promotes convergence and sound enforcement of laws governing conduct by firms with substantial market power. The working group presented a new workbook chapter on exclusive dealing arrangements as part of a project that is producing a practical guide to the investigation of the various types of unilateral conduct.
The Advocacy Working Group, co-chaired by the French Autorité de la Concurrence, the Portuguese Competition Authority and the Competition Commission of Mauritius, develops practical tools and guidance to improve the effectiveness of ICN members’ competition advocacy. This year, the working group developed draft guidance on procedures and analysis for assessing existing or proposed laws and regulations to determine whether they may have a significant impact on competition. The group also presented its work on practical techniques to help promote a competition culture and strategies for explaining the benefits of competition to other government entities.
The ICN was created in October 2001, when the Department of Justice and the FTC joined antitrust agencies from 13 other jurisdictions to increase understanding of competition policy and promote convergence toward best practices around the world. The ICN now includes 126 member agencies from 111 jurisdictions.
Sunday, April 28, 2013
COMPANY AND OWNER CHARGED WITH FRAUD BY SEC INVOLVING 2012 JOBS ACT
FROM: U.S. SECURITIES AND EXCHANGE COMMISSION
SEC Seeks to Halt Scheme Raising Investor Funds Under Guise of Jobs Act
The Securities and Exchange Commission today announced fraud charges against a Spokane Valley, Wash., company and its owner for misleading investors with claims to raise billions of investment capital under the Jumpstart Our Business Startups (JOBS) Act and invest it exclusively in American businesses.
The SEC alleges that Daniel F. Peterson and his company USA Real Estate Fund 1 promised investors that they could reap spectacular returns from an upcoming offering in a "secured" product backed by prominent financial firms. Peterson repeatedly told investors that the 2012 JOBS Act would enable him to raise billions of dollars by advertising the offering to the general public, and produce big profits for early investors. He preyed upon investors' sense of patriotism by promising to invest the proceeds of the offering in exclusively American businesses, and help assist in Washington State's economic recovery. The SEC alleges that Peterson used investors' money for personal expenses, and is continuing to solicit investors and may be preparing to tout the offering through investor seminars and public advertising.
According to the SEC's complaint filed in federal court in Spokane, Peterson sold common stock in USA Real Estate Fund from November 2010 to June 2012 to more than 20 investors in Washington and at least five other states. In e-mails and in periodic e-newsletters that he used to solicit USA Real Estate Fund investors, Peterson claimed that he was preparing to raise billions of dollars in a second offering of additional preferred" securities, which he claimed would be "secured" and have 10-year returns of up to 1,300 percent. Peterson claimed that two prominent Wall Street financial firms had partnered with him to bring his offering to market, and that the firms had conducted due diligence on USA Real Estate Fund and were structuring sales agreements and pricing. Peterson promised the early investors they would profit massively once the purported future offering was underway.
Peterson's claims were false. He has no guaranteed investment product to offer, the projected returns were either fictitious or based on implausible and unsupported analyses, and he has no affiliation with any financial firm to underwrite his purported future offering, the SEC alleged.
The SEC alleges that Peterson used investor money to pay for his rent, food, entertainment, vacations, and a rented Mercedes Benz SUV. He also used investor funds on clothing for friends, luggage for his wife, and expenses at a Las Vegas casino.
The SEC's complaint charges USA Fund and Peterson with violating Section 17(a) of the Securities Act of 1933 (Securities Act) and Section 10(b) of the Securities Exchange Act of 1934 (Exchange Act) and Rule 10b-5 thereunder. The SEC seeks disgorgement and financial penalties as well as a preliminary injunction restraining USA Real Estate Fund and Peterson from engaging in conduct that would allow them to continue their scheme, and restraining them from further violations of the securities laws.
David Berman and Tracy Davis of the SEC's San Francisco Regional Office investigated the case. The SEC appreciates the assistance of the Washington State Department of Financial Institutions.
SEC Seeks to Halt Scheme Raising Investor Funds Under Guise of Jobs Act
The Securities and Exchange Commission today announced fraud charges against a Spokane Valley, Wash., company and its owner for misleading investors with claims to raise billions of investment capital under the Jumpstart Our Business Startups (JOBS) Act and invest it exclusively in American businesses.
The SEC alleges that Daniel F. Peterson and his company USA Real Estate Fund 1 promised investors that they could reap spectacular returns from an upcoming offering in a "secured" product backed by prominent financial firms. Peterson repeatedly told investors that the 2012 JOBS Act would enable him to raise billions of dollars by advertising the offering to the general public, and produce big profits for early investors. He preyed upon investors' sense of patriotism by promising to invest the proceeds of the offering in exclusively American businesses, and help assist in Washington State's economic recovery. The SEC alleges that Peterson used investors' money for personal expenses, and is continuing to solicit investors and may be preparing to tout the offering through investor seminars and public advertising.
According to the SEC's complaint filed in federal court in Spokane, Peterson sold common stock in USA Real Estate Fund from November 2010 to June 2012 to more than 20 investors in Washington and at least five other states. In e-mails and in periodic e-newsletters that he used to solicit USA Real Estate Fund investors, Peterson claimed that he was preparing to raise billions of dollars in a second offering of additional preferred" securities, which he claimed would be "secured" and have 10-year returns of up to 1,300 percent. Peterson claimed that two prominent Wall Street financial firms had partnered with him to bring his offering to market, and that the firms had conducted due diligence on USA Real Estate Fund and were structuring sales agreements and pricing. Peterson promised the early investors they would profit massively once the purported future offering was underway.
Peterson's claims were false. He has no guaranteed investment product to offer, the projected returns were either fictitious or based on implausible and unsupported analyses, and he has no affiliation with any financial firm to underwrite his purported future offering, the SEC alleged.
The SEC alleges that Peterson used investor money to pay for his rent, food, entertainment, vacations, and a rented Mercedes Benz SUV. He also used investor funds on clothing for friends, luggage for his wife, and expenses at a Las Vegas casino.
The SEC's complaint charges USA Fund and Peterson with violating Section 17(a) of the Securities Act of 1933 (Securities Act) and Section 10(b) of the Securities Exchange Act of 1934 (Exchange Act) and Rule 10b-5 thereunder. The SEC seeks disgorgement and financial penalties as well as a preliminary injunction restraining USA Real Estate Fund and Peterson from engaging in conduct that would allow them to continue their scheme, and restraining them from further violations of the securities laws.
David Berman and Tracy Davis of the SEC's San Francisco Regional Office investigated the case. The SEC appreciates the assistance of the Washington State Department of Financial Institutions.
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