Tag Archives: SEC v. Obus

SEC ALJ in Bolan and Ruggieri Proceeding Rules Misappropriation Theory Mandates Proof of Benefit to Tipper

On February 12, 2015, SEC Administrative Law Judge Jason Patil rejected the SEC’s argument in the insider trading case In the Matter of Bolan and Ruggieri that the misappropriation theory did not require proof of a benefit flowing to the original tipper.  The respondents had moved for summary disposition of the case under the legal standard stated by the Second Circuit in United States v. Newman (see their Reply Brief on Impact of Newman Decision in In the Matter of Bolan and Ruggieri).  The SEC argued that Newman’s analysis applied only to the “classical theory” of insider trading.  ALJ Patil disagreed, in a brief ruling that can be read here: ALJ Ruling in In re Bolan and Ruggieri.

The ALJ stated the issue as follows: “whether, in an insider trading case brought under a misappropriation theory, the Division must establish that the tipper received a personal benefit for allegedly tipping material, non-public information.”  Slip op. at 1.  The ALJ rejected the SEC’s argument that the Newman court’s discussion of the personal benefit requirement was dicta.  He noted that the Second Circuit previously ruled in SEC v. Obus, 693 F.3d 276, 284 (2d Cir. 2012), that although the “tipping liability doctrine” stated by the Supreme Court in Dirks v. SEC involved a case under the classical theory, “the same analysis governs in a misappropriation case.”  As a result, when the Second Circuit “reconfirmed this principle” in Newman, “it was not mere dicta, but citing established law.”  Slip op. at 2.  He added: “Although the Division points to dicta from cases indicating that the personal benefit requirement is either not firmly established in misappropriation case-law or that it does not apply, no controlling authority has held as such.  Moreover, such a proposition would conflict with controlling authority—Dirks and Obus.”  Id.

On the issue of how the SEC could prove the required “personal benefit,” the ALJ said that proof of a close friendship between tipper and tippee “may be enough for a fact-finder to infer a personal benefit” (citing Obus, 693 F.3d at 291), but “such evidence, without more does not necessarily establish that the personal benefit element has been met.”  Slip op. at 2 (emphasis added).  His quote from the Newman opinion on the issue concluded with the Second Circuit’s focus on the need for proof of a personal benefit to establish “a fraudulent breach” by the tipper: “While our case law at times emphasizes language from Dirks indicating that the tipper’s gain need not be immediately pecuniary, it does not erode the fundamental insight that, in order to form the basis for a fraudulent breach, the personal benefit received in exchange for confidential information must be of some consequence.”  Slip op. at 3 (quoting Newman, 773 F.3d 438, 452 (2d Cir. 2014) (emphasis in original).

ALJ Patil ordered that the SEC make a factual proffer stating in “sufficient detail” “the allegations on which it intends to base its personal benefit theory,” and “the evidence it has or expects to establish at a hearing on the personal benefit element,” and suggested that he might hold “an evidentiary hearing on the issue of personal benefit.”

Straight Arrow

February 14, 2015

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Judge Rakoff Slams SEC for Increased Use of Administrative Proceedings

We have previously discussed the controversial decision of the SEC’s Division of Enforcement to move enforcement actions cases from the federal district courts to the SEC’s administrative court process.  This is particularly troubling as to civil prosecutions involving large potential “civil” penalties and ancillary relief like lifetime bars that can be debilitating to individual and corporate respondents.  Serious due process and separation of powers constitutional issues have been raised about this approach.  See our previous posts here, here, and here.

On November 5, 2014, U.S. District Court Judge Jed Rakoff, a constant thorn in the side of the SEC, told a gathering of SEC enforcement lawyers he was troubled by this policy as well.  A copy of Judge Rakoff’s speech is available here: Judge Rakoff PLI Speech.

Judge Rakoff did not venture into the merits of the legal challenges to these proceedings now proliferating in the courts.  Instead, he addressed the wisdom — or lack of wisdom — of the policy decision.  He first placed the SEC’s enforcement powers in historical context, noting that “When the SEC was first created in the 1930’s, its enforcement powers were largely limited to seeking injunctions in federal district courts to enjoin violations of the securities laws, and the only express provision for administrative hearings was to suspend or expel members or officers of national securities exchanges.”  In the next 50 years, expansions of the SEC’s enforcement powers were “tied to the agency’s oversight of regulated entities or those representing those entities before the Commission, and even then was largely ancillary to the broader remedies and sanctions it could obtain only by going to federal court.”  The power to seek monetary relief in these proceedings, in the form of so-called “disgorgement,” was not added until 1990.  And it was not until the Sarbanes-Oxley Act in 2002 that the SEC was accorded the extraordinary “power to employ administrative proceedings to bar any person who had violated the securities laws from serving as an officer or director of a public company.”  Finally, the 2010 Dodd-Frank Act gave the SEC “the power through internal administrative proceedings to impose substantial monetary penalties against any person or entity whatsoever if that person or entity has violated the federal securities laws, even if the violation was unintentional.”

Almost all of these accretions in SEC enforcement power, Judge Rakoff noted, came about “at the request of the SEC, usually by tacking the provisions authorizing such expansion onto one or another statute enacted in the wake of a financial scandal,” based on “a claim greater efficiency.”  Judge Rakoff’s acerbic nature is reflected in his reaction to this: “While a claim to greater efficiency by any federal bureaucracy suggests a certain chutzpah, it is hard to find a better example of what is sometimes disparagingly called ‘administrative creep’ than this expansion of the SEC’s internal enforcement power.”  This “efficiency,” he noted, is achieved by depriving the targets of enforcement actions of key procedural protections.  “Superficial” “streamlining” comes about “for the simple reason that SEC administrative proceedings involve much more limited discovery than federal actions, with no provision whatsoever for either depositions or interrogatories.  Similarly, at the hearing itself, the Federal Rules of Evidence do not apply and the SEC is free to introduce hearsay.  Further still, there is no jury, and the matter is decided by an administrative law judge appointed and paid by the SEC.”  As a result: “It is hardly surprising in these circumstances that the SEC won 100% of its internal administrative hearings in the fiscal year ending September 30, 2014, whereas it won only 61% of its trials in federal court during the same period.”

Beyond this concern, Judge Rakoff identifies another serious policy concern: moving cases from the federal courts to the SEC’s captive administrative court “hinders the balanced development of the securities laws.”  He notes that SEC enforcement actions often involve charges of fraud, which is a concept with little statutory or administrative, as opposed to judicial, development.  “Indeed, the SEC has often resisted any attempt to replace these provisions with something more specific, on the theory that such broad statutory provisions provide the flexibility needed to deal with the new schemes that fraudsters are constantly devising.”

His prime example is the area of insider trading, where the SEC “has repeatedly resisted any effort by Congress to statutorily define insider trading, preferring to leave the concept sufficiently flexible as to be able to adjust to new developments.”  “Fair notice” of what does, and does not, constitute insider trading fraud comes from “federal courts, where the law of insider trading has been developed and elaborated in much-publicized cases.”  Judge Rakoff noted that in two recent insider trading cases, SEC v. Cuban and SEC v. Obus, the SEC suffered “stinging defeats.”  As a result, “the SEC might well be tempted in the future to bring such cases as administrative enforcement actions, and thereby likely avoid the sting of well-publicized defeats.  But the result would be that the law in such cases would effectively be made, not by neutral federal courts, but by SEC administrative judges.”  And the availability of judicial review of these decisions, after they are reviewed by the SEC itself, is extremely limited because the SEC’s decision must be “presumed correct unless unreasonable” under the required appellate review standard.

Here is Judge Rakoff’s devastating conclusion:

In short, what you have here are broad anti-fraud provisions, critical to the transparency of the securities markets, that have historically been construed and elaborated by the federal courts but that, under Dodd-Frank, could increasingly be construed and interpreted by the SEC’s administrative law judges if the SEC chose to bring its more significant cases in that forum.  Whatever one might say about the SEC’s quasi-judicial functions, this is unlikely, I submit, to lead to as balanced, careful, and impartial interpretations as would result from having those cases brought in federal court.

In the short-run, this would be unfair to the litigants.  In the longer-run, it might not be good for the SEC itself, which has its own reputation for fairness to consider.  But, most of all, in the both the short-run and the long-run, it would not be good for the impartial development of the law in an area of immense practical importance. . . .

I see no good reason to displace [the Article III judicial process] with administrative fiat, and I would urge the SEC to consider that it is neither in its own long-term interest, nor in the interest of the securities markets, nor in the interest of the public as a whole, for the SEC to become, in effect, a law onto itself.

Hear, hear!

The plot thickens on the SEC’s enforcement power grab.  Judge Rakoff, who had considerable prosecutorial experience in the securities area before he was appointed to the bench, has an extensive following on the issues of securities law enforcement.  The new Republican Congress is not likely to be enamored of an enforcement process that enhances administrative powers at the expense of individual rights.  SEC Chair Mary Jo White should get prepared for a bumpy ride.

Update on SEC response:

In a panel discussion the next day at the same PLI conference, Andrew Ceresney gave a rejoinder to the Rakoff criticism.  Essentially, he argued that the SEC has no comparative advantage when it litigates in front of its own administrative law judges.  An extended analysis of his arguments can be found here.  In sum, he’s wrong, and badly so.  You can see a description of his comments here.  Cereseny needs to do some homework before he makes comments that show he simply doesn’t understand the issues.

Straight Arrow

November 6, 2014 (updated November 10, 2014)

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Opposition Growing to SEC’s New “Star Chamber” Administrative Prosecutions

In our first blog post in April 2014, we asked: “Why Isn’t the SEC Committed to a Just and Fair Enforcement Process?”.  Several months later, the SEC’s new enforcement director announced the SEC’s plans to bring more prosecutions in its captive administrative court, taking them out of the federal courts.  Whether coincidentally or not, this decision came in the midst of growing publicity on repeated SEC losses in federal court enforcement actions it brought: e.g.SEC v. Stoker; SEC v. Cuban; SEC v. KovzanSEC v. Obus; SEC v. Jensen; SEC v. Schvacho; SEC vSteffesSEC v. Petit (case dropped on eve of trial); SEC v. Graham; SEC v. Moshayedi.  (We wrote posts about ObusGraham, and Moshayedi.)  We questioned this decision as a matter of fairness and public policy in our June 12, 2014 post: “SEC Enforcement Director Announces Future Plans To Avoid Jury Trials.”  In his announcement, the enforcement director acknowledged that the SEC was at least partially motivated by a desire to move cases to a forum more hospitable to the SEC.

The SEC’s use of administrative proceedings to prosecute penal enforcement actions has many of the characteristics of a “Star Chamber” proceeding.

  • The SEC enforcement staff convinces the Commission to bring a case in a private meeting.
  • The case is commenced in a court overseen by an SEC administrative law judge (ALJ), who is hired by, and works in an Office within, the SEC.
  • The case proceeds under Rules of Practice set by the SEC.
  • The respondent in a proceeding has limited rights to gather evidence to defend the case — e.g., there is no right to subpoena evidence from the SEC or third-parties without ALJ approval (which the SEC litigators routinely oppose); there is no right to depose witnesses in advance of trial to learn what evidence they may have; there is no right to challenge the SEC enforcement staff’s unilateral determination of what gets included in the enforcement “file” that gets delivered to the respondent.
  • The respondent must be ready to try the case under an expedited schedule, but the SEC typically has had years to develop and review evidence before the case is brought.
  • The standard rules of evidence do not apply at trial.
  • There is no jury.
  • The judges are of varying quality (never having gone through an independent approval process), have much greater familiarity with the SEC lawyers than defense lawyers, tend to give great leeway (and sometimes deference) to the SEC lawyers, and are forced to decide complex cases under the deadline set by the SEC itself.
  • After the ALJ rules, the right of appeal is to . . .  the SEC.  The very group that authorized bringing the case gets to rule on the appeal sitting in an administrative adjudicative capacity; the prosecutor becomes the judge.
  • Only after that process is complete — and we’re now talking about years into the case with huge costs of defense — does the respondent have a right to appeal the decision to an independent court.  Even then, the appellate court is saddled with a “standard of review” that allows it to overturn the SEC’s determination only if it is “arbitrary,” an “abuse of discretion,” or “contrary to law.”  Essentially, only if no reasonable basis can be found to support the Commission’s findings, they must be affirmed.  As a result, no person outside of the SEC reviews the evidence de novo to decide if it fairly supports findings against the respondents under the applicable burden of proof, or if the sanctions imposed are fair. 

I am not suggesting that SEC administrative law judges knowingly stack the deck against respondents.  I think they try to be fair.  But they cannot alter the fact that the rules of these proceedings are stacked against respondents in the ways described above.  And it is not surprising that they may tend to undervalue due process protections, and evidentiary niceties, that may make their jobs, and the jobs of the SEC litigators, more difficult.  Of course, this is not a true “Star Chamber” because general notions of due process are still recognized, but the proof of the pudding is in the eating, and, there is no doubt that defense counsel prefer a judicial forum, and the SEC’s enforcement director himself noted that the SEC’s administrative courts seem to provide the SEC an advantage over those pesky federal courts.

The advantages to a defendant of a highly-qualified, independent, Article III judge cannot be over-emphasized.  The entire pre-trial process is imbued with disputes about how information and evidence can be gathered and must be shared, as well as what can and cannot be included in the case, and on what issues there actually is disputed evidence that justifies a trial.  And then, of course, there is the administration of the trial and the determination of evidence to be considered.  Most federal district court judges approach these issues seriously, fairly, and with true understanding of the importance in a case brought by the Government that the defendant is getting a “fair shake.”  One recent example of this (discussed in detail here) is Judge Scheindlin’s willingness to reject the SEC’s overbearing and totally unjustified effort to obtain so-called “disgorgement” from the Wyly brothers of $500,000,000 based on near-preposterous arguments about how the amounts they realized from stock options granted to them as management of highly successful companies were derived from non-disclosures about their control of stock held by offshore trusts.  It is rare that ALJ’s repudiate the SEC so thoroughly in administrative cases (although, to be fair, it has happened on rare occasions).

There seems to be a rising sense of abuse of power in the SEC’s announced decision to bring more of its civil prosecutions before its administrative law court.  Several articles or comments addressing this issue are linked in the “SEC Enforcement” section in the right margin of this blog.  One of these articles discusses a recent comment by district court judge Jed Rakoff (a former head prosecutor for securities cases in the U.S. Attorney’s office) asking “from where does the constitutional warrant for such unchecked and unbalanced administrative power derive?”.  Some suggest that the transfer of non-technical securities enforcement prosecutions to this forum to gain the advantage of reduced procedural protections violates due process requirements.  Thus, cases not focused on rules violations like technical broker-dealer or investment advisory rules, but rather on broader accusations of “fraud,” seem suspiciously out of place in an administrative court, the stated purpose of which is to allow the application of special expertise to these cases.

Keep an eye on developments in this area.  The SEC will not get a free ride on this.  In my estimation, the D.C. Circuit court appeals will be considering this issue in the not-too-distant future.

Straight Arrow

August 7, 2014

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SEC Enforcement Takes Another Blow in SEC v. Obus

The SEC’s most recent jury trial loss in its insider trading case SEC v. Obus et al., No. 06 Civ. 3150 (GBD), is another example of a poorly-conceived case going down in flames.  A jury conferred for less than a day and rejected the SEC’s claims of insider trading against all three defendants.  After being exonerated, hedge fund manager Nelson Obus said: “This is not just about me.  This is about systematic regulatory overreach without accountability.”

That the case was ill-conceived from the get-go is not really a matter of opinion, it is plain from the history of the case, which shows that the SEC overstated its allegations and revised its theory of the case to overcome serious evidentiary inadequacies.  The SEC’s Enforcement Division badly needs to learn that merely conjuring up hypothetical conversations and ignoring unhelpful facts is not enough.  The facts matter.  The evidence matters.  Obus was a case with bad facts and weak evidence.  Appropriate prosecutorial discretion would have sent it to the scrap heap.

Bear with me in reviewing the facts, which are critical.  Defendant Thomas Strickland had a junior job at General Electric Capital Corp. (GECC).  GECC became involved in the potential financing of transactions involving SunSource, Inc. (which sold nuts and bolts), including a possible management buyout of a SunSource subsidiary (STS Technologies), and the proposed acquisition of SunSource by Allied Capital Corp.  Strickland was assigned to perform due diligence on SunSource.  That involved learning about SunSource’s business and financial performance.  The financing discussions were preliminary; there was never an agreement requiring that GECC keep information about SunSource confidential.

In the course of due diligence, Strickland noticed that Wynnefield Capital, a hedge fund manager, was a significant SunSource shareholder.  He had a college friend who worked at Wynnefield, defendant Peter Black.  On May 24, 2001, he called Black to discuss SunSource.  The only evidence of that conversation was from Strickland and Black, who both testified that Strickland noted that GECC was considering doing work with SunSource and asked for general impressions of management and the company.  The SEC contended, however, that Strickland told Black that Allied was about to acquire SunSource.

After that call, still on May 24, Black went to his boss, defendant Nelson Obus, who was a principal of Wynnefield.  The only evidence of that conversation was from Black and Obus, who both testified that Black told Obus about a general interest of GECC in SunSource in connection with possible new business with that company.  GECC did lots of financing business, and Obus became concerned about a possible transaction in which SunSource could obtain capital by diluting its shareholders in a transaction similar to one with Allied Capital just a few months earlier (a so-called “PIPE” transaction).  The SEC contended that Black told Obus that SunSource was about to be acquired by Allied.

What happened next bore no resemblance to a fraudulent insider trading scheme.

Instead of going out quickly to buy SunSource stock, Obus called SunSource’s CEO, to whom he spoke regularly as a large shareholder.  The accounts of that conversation varied.  Obus said he told the CEO that he had heard about SunSource from a source in Connecticut (where GE is headquartered) and argued against doing another PIPE transaction,  The CEO and said that Obus told him he had heard from “a little birdie” in Connecticut that SunSource was being acquired by a “financial buyer.”  Whatever was actually said – on which there was contradictory evidence – was not consistent with a fraudulent insider trading scheme.  It is hard to imagine such a scheme being commenced by a call from the supposed “tippee” to the CEO of the subject company announcing he had been tipped to the planned transaction.  In his closing argument to the jury, Obus’s lawyer said Obus would be “the lamest insider trader in history” if he acted this way.

The remaining facts are likewise inconsistent with such a scheme.  Obus did not go out quickly after the May 24 call to buy more shares of SunSource stock.  Nothing happened for more than two weeks.  It wasn’t until June 8 that a Cantor Fitzgerald broker called the trader at Wynnefield, not vice versa, to inquire about possible interest in purchasing a block of SunSource stock at $5 per share.  Wynnefield negotiated for a lower price and ultimately bought 287,200 shares at $4.80 per share.  (This raised Wynnefield’s ownership of SunSource from 5.8% to over 10%.)  Three days later, Wynnefield sold 6,000 shares of SunSource stock.  After the Allied/SunSource merger was announced on June 19, Wynnefield did not sell its shares – it bought an additional 140,000 shares.  Nothing about this series of transactions smacks of insider trading, particularly that Wynnefield (1) did not seek out or initiate the block trade, and (2) then sold shares three days thereafter.

The SEC Staff plainly knew the facts did not present a convincing case.  They drafted a Complaint that that, at a minimum, bordered on being disingenuous by creating an impression of deceit and scheming that could not be supported.  For example, they alleged that Obus “directed the purchase of 287,200 shares of SunSource common stock based on a tip he had received” from Black (Complaint ¶ 1), and “directed Wynnefield’s trader to purchase” the block of shares, “which the trader then did” (id. ¶ 24).  The SEC knew, however, and intentionally omitted, that Obus never initiated a purchase of SunSource stock, and that Wynnefield bought the block of stock only after being approached by a trader shopping it.  The Complaint also alleged that a June 4 call by Black to Strickland “provided Black with the opportunity to receive an update on the progress of the transaction and to update Obus” (id. ¶ 23) with no evidence to support that the call had anything to do with SunSource.

The SEC also pursued a flawed theory from the outset.  The SEC’s Complaint, filed in April 2006, presented only one theory of insider trading, which was the so-called “classical theory” of insider trading.  Our ongoing post about the origins and development of insider trading law will describe the various mutations of insider trading theory that have occurred.  The “classical theory” is that the insider owes a “fiduciary duty” or fiduciary-like duty (whatever that may mean), to the company’s shareholders, and therefore cannot trade stock with the shareholders without disclosing material information he or she may have.  The notion is that the fiduciary duty creates a duty to disclose in transactions with beneficiaries of that fiduciary obligation.  That an insider owed fiduciary obligations to the company’s shareholders was inconsistent with most state laws, but was essentially a fiction created by the SEC and the federal courts to justify treating insider trading as an act of fraud.

In support of this theory, the SEC Complaint alleged that “Strickland owed a fiduciary or similar duty of trust and confidence to the shareholders of SunSource” based on his employment with GECC and GECC’s relationship with SunSource.  (Id. 34.)  Black was allegedly liable because he “knew or should have known” that Strickland breached a fiduciary duty to the SunSource shareholders and as a result “assumed Strickland’s duty” to them and breached that duty by communicating the information to Obus.  (Id. ¶ 37.)  Obus was allegedly liable because he “knew or should have known” that the information about SunSource had been communicated in breach of a fiduciary duty to the SunSource shareholders and “assumed the duty to the shareholders of SunSource” that Strickland owed and Black assumed.

There was a problem, however, that the SEC and its Staff “knew or should have known” from the outset: there was no evidence to support the contention that GECC owed any fiduciary-like duty to SunSource, and, as a result, neither could its employee, Strickland.  After four years of investigation, the Complaint adopted and pursued this theory with no serious evidence of any agreement between GECC and SunSource that created any such duty.  The defendants pointed this out in motions to dismiss the Complaint.  Although these motions were denied, the SEC litigators knew they had filed a complaint that the evidence would not support.

Not to worry.  The SEC decided to morph its case to a different form in midstream.  It filed an Amended Complaint to state a different theory of insider trading, the so-called “misappropriation theory.”  That theory was developed by the courts as a means of expanding the scope of “insider” trading to create a violation of the federal securities laws when any trusted person abuses his or her trust by using confidential information to make securities trades.  How this became part of insider trading will be addressed in our broader post on the development of “insider trading” law, but in 1997, the Supreme Court endorsed this extension of the law in United States v. O’Hagan, 521 U.S. 642 (1997).

The SEC’s Amended Complaint supported this theory by introducing a new allegation that “Strickland owed a fiduciary duty of trust and confidence to his employer, GE Capital, pursuant to which, inter alia, was the duty to not disclose material, nonpublic information learned during the scope of his employment to outsiders.”  (Amended Complaint ¶ 45.)  To hedge its bets, the SEC continued to pursue the “classical theory” as well.  (Id. ¶ 46.)  Black and Obus were now alleged to be liable because they “knew or should have known” that Strickland breached duties to both GECC and SunSource, and they assumed those same duties to both GECC and SunSource.  (Id. ¶¶ 51-52.)

There was still a problem, however.  GECC, which now purportedly was the “victim” of Strickland’s fraud, had itself conducted an investigation of Strickland’s conduct and concluded that his conversation with Black was an effort at underwriting, not a tip, and reprimanded him because he “made a mistake” by contacting third parties without prior approval.  Apparently, the evidence would show that the supposed “victim” did not believe it was victimized.  The SEC litigators’ approach to solving that problem was not to rethink its case, but instead to try to hide that fact from the jury by preventing it from coming into evidence.  It filed a motion in limine to ask the court to do just that.

We will never know what combination of flaws caused the jury to rule for the defendants.  Remember, in SEC enforcement actions, the burden of proof is only a preponderance of the evidence.  That means that the jury found that the SEC’s evidence couldn’t even barely tip the scales.

It should have been obvious from the beginning and as the case proceeded that there was very little there there.  (Apologies to Gertrude Stein.)  The SEC did not even have the benefit of significant circumstantial evidence of the type it normally has, like large, inexplicable trades, often in options, immediately following a suspect communication.  Instead, the SEC was placing all of its bets, including, no doubt, millions of taxpayer dollars in expense and resources, on the disputed recollections years after the fact about one telephone conversation – a purported communication that, on its face, made no sense, and refuted the very notion that Obus was trying to deceive anyone.  Somewhere along the way, some form of review or supervision should have been called into play to reconsider the wisdom of the case.  But as in other cases, the SEC Staff’s single-minded focus on victory, to the point of introducing fundamental changes in its theory of liability, apparently prevented them from reexamining the case and making the “right” call long before the jury forced it on them.  See our blog post “Why Isn’t the SEC Committed to a Just and Fair Enforcement Process?

Here is what Mr. Obus thought about the SEC enforcement lawyers: “What I see happening here is a totally unaccountable organization — run by a group of anonymous legal underperformers probably incentivized simply by putting scalps up on the wall, with no concerns about getting to the truth — being able to attack the growth fountain of our whole economy, which is small business.  The SEC goes after small people like myself. I have more in common with the guy who runs the candy store. These bullies are putting me in a position where I have to admit something I didn’t do and that I find reprehensible, and if I don’t do that, I’m busted; I’m out of business. To me, that is overreach.”  See “Obus Says SEC Attornyes Are “Bullies” in our link to the right.  The NY Times Dealbook blog on this case is “After Fighting Insider Trading Charges for 10 Years, a Fund Manager Is Cleared.

 Straight Arrow

June 3, 2014

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