Compliance & Ethics

In a significant stride toward combating global corruption, the United States has enacted the Foreign Extortion Prevention Act (FEPA), allowing federal prosecutors to bring criminal charges against foreign government officials soliciting or accepting bribes from U.S. companies. The newly minted law, a component of the National Defense Authorization Act, addresses a longstanding gap in the fight against corruption, as it criminalizes the "demand" side of cross-border corruption, providing a crucial addition to the Foreign Corrupt Practices Act (FCPA).

In a candid interview with the Wall Street Journal's Risk and Compliance Journal, Acting Comptroller of the Currency Michael Hsu delved into the multifaceted landscape of banking regulations, risk management, and the intricate dance between financial stability and technological evolution. The tumultuous year of 2023 witnessed the banking sector thrust into the spotlight, grappling with crises that engulfed Silicon Valley Bank, Signature Bank, and Credit Suisse Group. Against this backdrop, Hsu provided unique insights into the regulatory intricacies shaping the industry and outlined potential strategies for the future:

The Securities and Exchange Commission (SEC) has taken swift action against Miami-based real estate developer Rishi Kapoor, securing an asset freeze and emergency relief in response to an alleged $93 million real estate investment fraud. The SEC has also filed charges against Location Ventures LLC, Urbin LLC, and 20 other entities connected to the fraudulent scheme.

Securities and Exchange Commission Commissioner Mark T. Uyeda has been sworn in for his second term, solidifying his commitment to overseeing the nation's financial markets. The ceremony took place at the Securities and Exchange Commission on December 28, 2023, marking the continuation of Commissioner Uyeda's dedicated service.

BNP Paribas, one of Europe's leading financial institutions, is under investigation by French prosecutors in connection with alleged "aggravated money laundering," according to a report by French daily Le Monde. The probe centers around transfers made by Cypriot brokerage firm TCR International Limited, which collaborated with BNP Paribas' custodian unit.

LPL Financial LLC, a leading financial services firm, is facing a hefty fine of $5.5 million from the Financial Industry Regulatory Authority (FINRA) due to multiple supervision lapses spanning several years. The sanctions come in response to a range of violations related to direct business transactions, inadequate record-keeping, inaccurate customer communications, and shortcomings in supervisory systems.

The Securities and Exchange Commission (SEC) has granted awards totaling more than $28 million to seven individuals. This collective effort of whistleblowers resulted in successful SEC enforcement actions, showcasing the effectiveness of the whistleblower program in upholding investor protection and market integrity.