ON Securities

As I reported previously, the SEC enforcement staff is “loaded for bear,” stepping up its enforcement activities to go after violations of the securities laws. Some recent stories reinforce that it is more important than ever to guard against these violations . . . . The Wall Street Journal reported on Wednesday that the SEC has greatly expanded its insider trading investigations of broker-dealers and hedge funds . . . . There is no reason to think that the current investigations are limited to broker-dealers and hedge funds, and the trail could easily lead the SEC staff to company personnel. . . . [to read more, click on the link above]

I attended a compelling legal education program this week, taught by Egil “Bud” Krogh. Political junkies know that Krogh was a young assistant White House counsel in the Nixon years. As a leader of the “Plumbers” unit, he authorized the 1971 break-in of the offices of Daniel Ellsberg’s psychiatrist after the leak of the Pentagon Papers. After the break-in came to light in the Watergate hearings, Krogh pleaded guilty, served time in prison, was disbarred and later reinstated. Bud now lectures on the topic of legal ethics, based on his recent book, Integrity: Good People, Bad Choices, and Life Lessons from the White House. His premise: in a pressure-filled environment such as the White House, intense loyalty to individuals can blind you to your higher principles. . . . . Krogh’s description of an environment that can put pressure on decision-making is familiar to anyone called on to say yes or no to any proposal by a corporate officer. . . . [H]ow do some decisions, even decisions by good people, go astray? A great example can be found in the options backdating scandals. . . . I asked Krogh how to advise an attorney . . . how to avoid the pitfalls of losing perspective in a pressure-filled situation . . . . [to read more, click on the link above]

I spoke this week at a Minnesota CLE Conference on the topic of how public companies can avoid liability for their disclosures. In preparing my remarks, it struck me that the SEC is “loaded for bear” in going after public companies and their officers with investigations and enforcement proceedings. . . . Recent examples, just during July and August of 2009 . . . . [to read more, click on the title above]