CUBE RegNews:
August 11th
Bittrex Global GmbH settles SEC charges for unregistered securities exchange
The Securities and Exchange Commission (SEC) has announced that Bittrex Global GmbH, a foreign affiliate of cryptocurrency exchange Bittrex Inc, has agreed to settle charges that it operated as an unregistered securities exchange.
The SEC alleged that Bittrex Global operated an exchange for the trading of cryptocurrency tokens that the SEC determined to be securities. The SEC also alleged that Bittrex Global failed to register with the SEC as a broker-dealer, a requirement for entities that engage in the business of buying and selling securities.
As part of the settlement, Bittrex Global has agreed to pay a penalty of $5.6 million and to register with the SEC as a broker-dealer. Bittrex Global also agreed to take steps to ensure that it complies with the securities laws in the future. Disgorgement and interest take the total fine to $24 million.
The settlement is a reminder to cryptasset exchanges and other entities that offer or trade crytoassets deemed as securities that they must comply with the securities laws. The SEC is committed to enforcing the securities laws in the cryptocurrency industry, and will continue to take action against entities that violate the law.
CFTC appoints Tamika Bent as Chief Counsel
The Commodity Futures Trading Commission (CFTC) has appointed Tamika Bent as Chief Counsel. Bent will serve as the principal legal advisor to CFTC Commissioner Kristin Johnson.
Bent is an experienced derivatives lawyer with more than 15 years of experience in private practice, in-house counsel, and academia. She has significant expertise in the derivatives markets and extensive knowledge about the implementation of the Dodd-Frank Act financial reforms.
In her new role, Bent will be responsible for providing legal advice and counsel to Commissioner Johnson on a wide range of issues, including the regulation of derivatives markets, customer and taxpayer protection, market integrity, financial stability, and transparency.
Bent joins the CFTC from law firm Linklaters, where she served as Counsel in the Financial Regulatory Group. She was previously at Milbank and Allen & Overy. Tamika’s practice has focused on complex derivatives, banking, and broker-dealer regulatory, transactional, and related bankruptcy matters.
Bent’s appointment is effective immediately.
Corficolombiana agrees to $80 million penalty to resolve foreign bribery case
Corficolombiana, a Colombian financial services institution, has agreed to pay more than $80 million to resolve parallel bribery investigations by criminal, civil, and administrative authorities in the United States and Colombia.
The US Department of Justice (DOJ) has confirmed that Corficolombiana has entered into a three-year deferred prosecution agreement (DPA) in connection with the charges that the company conspired to violate the anti-bribery provision of the Foreign Corrupt Practices Act (FCPA).
The DPA is the first-ever coordinated resolution between the DOJ and Colombian authorities in a foreign bribery case. The DOJ has worked closely with the Colombian government throughout the investigation and prosecution of this case.
According to the DPA, between 2012 and 2015, Corficolombiana conspired to offer and pay more than $23 million in bribes to high-ranking Colombian government officials in order to win a contract to construct and operate a highway toll road known as the Ocaña-Gamarra Extension. Corficolombiana conspired with Odebrecht SA (Odebrecht), a global construction conglomerate based in Brazil, to pay bribes to Colombian government officials in the executive and legislative branches and to an executive at Colombia’s state-owned infrastructure agency, to win the rights to construct and operate the Ocaña-Gamarra Extension. To carry out the bribery scheme, Corficolombiana caused other entities to enter into fictitious contracts with companies associated with intermediaries that passed along the bribe payments to the Colombian government officials. Ultimately, Corficolombiana earned approximately $28.63 million in profits from the corruptly obtained business.
In addition to the DPA, Corficolombiana has also agreed to pay $40 million in disgorgement and prejudgment interest to resolve charges that it violated the anti-bribery provisions of the FCPA in an administrative proceeding brought by the US Securities and Exchange Commission (SEC).
The Corficolombiana case is a reminder of the serious risks of foreign bribery and the importance of having strong anti-corruption compliance programs in place. The DOJ and SEC have been increasingly aggressive in their enforcement of the FCPA, and companies that fail to comply with the law can face significant penalties.
APRA updates policy priorities for in response to overseas banking stress events
The Australian Prudential Regulation Authority (APRA) has announced that it has updated its policy priorities for authorized deposit-taking institutions (ADIs) in response to the recent overseas banking stress events.
APRA said that it will prioritize some immediate actions to strengthen standards for bank financial stability issues, and will slow down timelines on less pressing policy reforms.
The key policy priorities for ADIs in 2023 are:
- Liquidity: APRA will consult on targeted changes to Prudential Standard APS 210 Liquidity, focused on the treatment of liquid assets for ADIs on the minimum liquidity holdings approach.
- Interest rate risk: APRA will take additional time to finalize Prudential Standard APS 117 Capital Adequacy: Interest Rate Risk in the Banking Book. The revised standard will be released in late 2023 and its effective date will be moved back to ensure sufficient implementation time for ADIs.
- Additional Tier 1 (AT1): APRA will issue a Discussion Paper to explore options for, and seek feedback from stakeholders on, improving the effectiveness of AT1 capital in Australia.
- Capital framework updates: APRA will consult on minor updates to the bank capital framework in relation to issues raised by industry during the implementation of the capital reforms earlier this year.
APRA said that the updated policy priorities reflect its commitment to ensuring the safety and soundness of the Australian banking system. The regulator added that it will continue to monitor the global financial markets closely and take further action as needed to protect Australian ADIs from financial stress.
CUBE RegNews:
A selected summary of key developments for regulated financial institutions
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