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Investment Firm Fined $15 Million for Cherry Picking and Soft Dollar Schemes

An investment firm's plan to defraud clients out of $10.9 million landed it a $15 million penalty from the U.S. Securities and Exchange Commission (SEC). On top of the penalty, the firm must disgorge — or give up the profits secured through their misconduct — another $1.4 million gained by misusing "soft dollars" and "cherry picking" trades. The SEC also went after individuals, imposing separate fines on the firm's founder and another advisor and barring both from the securities industry.

Workplace-Diversity Data Continues To Drive Awareness in Silicon Valley

The technology industry has been criticized in recent years for its lack of diversity in its mostly male workforce as advocates call on companies to be more transparent with their demographic information. Apple Inc. is one of the last big tech companies to respond and publicly share demographic data, revealing that its workforce is 70% male (global) and 55% white (U.S.). The company also reported that 11% of its U.S. workforce is Hispanic and 7% black — numbers that are much higher than similar Silicon Valley companies. In a prior blog post, we noted Google’s recent employee-diversity data that reported only 2% of its employees are black and 3% Hispanic. Apple’s higher numbers, however, may be attributable to its retail employees, who make up over half of its full-time workforce.

EEOC Sues Employer for Forcing “Onionhead” Religious Practices on Workers

The U.S. Equal Employment Opportunity Commission (EEOC) recently sued a health network, alleging that the company fired employees who refused to participate in activities that the federal agency claimed were religious practices. According to the EEOC's complaint, the company forced employees to take part in a belief system that the company called “Onionhead.”

Proposed FERPA Update Would Strengthen Student Data Privacy

On July 30, 2014, two U.S. senators introduced the Protecting Student Privacy Act, which would update the sections of the Family Educational Rights and Privacy Act (FERPA) that deal with protecting the privacy of students' education records. The proposed legislation is a response to concerns about recent changes to FERPA that allowed increased use and sharing of student data by private companies, as well as concerns raised by the use of cloud-storage services by school districts for data collection and analysis.

California Court Dismisses CMIA Claim Based on Possession of Stolen Medical Data

A health organization narrowly averted paying a potential $4 billion in damages under the California Confidentiality of Medical Information Act (CMIA) for losing the medical records of more than 4 million patients. Plaintiffs were seeking $1,000 damages for each individual whose medical records were contained on an unencrypted hard drive stolen from the health organization. However, the California Court of Appeals dismissed the case because the plaintiffs based their claim solely on the fact that the information was stolen and in the possession of —but not viewed by —an unauthorized person. Without proving the information was viewed, the plaintiffs could not show an injury for which the defendant could be held liable.

Dodd-Frank Splits Courts on Granting Whistleblower Protections

As more claimants take advantage of the U.S. Securities and Exchange Commission's (SEC) whistleblower program created under the Dodd-Frank Act of 2010, courts have increasingly been called upon to decipher the law's provisions protecting claimants from retaliation. In particular, the issue of whether Dodd-Frank requires an informant to make a complaint directly to the SEC in order to qualify as a whistleblower — and thus be protected from retaliation — has become more divisive and could eventually be left to the U.S. Supreme Court to decide.

Anti-Corruption Enforcement Targets Financial Service Industry

The U.S. Department of Justice (DOJ) recently made enforcement of the Foreign Corrupt Practices Act (FCPA) a top priority, second only to terrorism. While an overall increase in enforcement puts all industries on alert, the financial services industry — already facing heightened regulatory scrutiny in the wake of the 2008 financial crisis — should be particularly concerned. While historically not a sector that has seen much FCPA enforcement action, the financial services industry should prepare for increased enforcement of anti-bribery and anti-corruption laws not only in the U.S., but around the world.

Oklahoma, Louisiana and Rhode Island Continue Trend Enacting New Password-Protection Laws

In 2012, Maryland became the first state to prohibit employers from requiring employees or job applicants to provide passwords to their personal social media accounts. Since then, the trend for states to limit employers' access to personal online content has been accelerating. There are now 17 states that have enacted such laws, with at least 11 more and the federal government considering doing the same.

OSHA To Refer Untimely Whistleblower Complaints to the NLRB

Whistleblower complaints filed under Section 11(c) of the Occupational Safety and Health Act (OSH Act) that might previously have been dismissed because they exceed the 30-day statute of limitations may find new life as unfair labor-practices claims filed with the National Labor Relations Board (NLRB).

6 Tips for Creating an Effective Workplace-Violence Prevention Program

A medical center faces $78,000 in fines for failing to protect its employees against workplace violence, following an investigation by the Occupational Safety and Health Administration (OSHA). The investigation revealed that, despite approximately 40 incidents of workplace violence against employees within a two-month period, the medical center failed to take any effective measures to prevent such assaults. According to OSHA, employees were subject to threats, verbal and physical assaults by patients and visitors and injuries while breaking up altercations between patients. The most serious incident resulted in severe brain injuries sustained by a nurse following an attack at work.

ACC Alliance Partner
Thomson Reuters