The False Claims Act historically has been used to prosecute procurement and healthcare fraud that result in losses to the government. Over the past four years, however, plaintiffs have expanded their use of the statute to include cases of complex financial fraud in which the government is in indirectly involved. In a recent client alert, Latham & Watkins explains how New York is now using its state version of the False Claims Act to prosecute tax fraud. In the first such action, New York targeted Sprint-Nextel alleging a $100 million underpayment of state taxes. The Client Alert is available for download here.
The Financial Services Oversight Council has proposed for public comment three alternatives for structural reform of money market mutual funds (MMFs). Alternative one would require MMFs to have a floating net asset value per share. Share prices would not be fixed at $1, but rather would reflect the actual market value of the underlying portfolio holdings. Alternative two would continue to fix the net asset value at $1, but would require MMFs to maintain a buffer of 1% to absorb day-to-day fluctuations. Alternative three would also continue to fix the net asset value at $1, but would have a 3% buffer requirement in combination with other risk reducing measures such as diversity requirements or minimum liquidity levels. In a recent Financial Services Alert, Goodwin Proctor has a more in depth summary of the alternatives.
California Attorney General Kamala Harris has begun sending warning letters to approximately 100 mobile app developers notifying them that their privacy policies do not comply with California law. The California Online Privacy Protection Act requires developers to post easily identifiable and reasonably accessible privacy policies. Penalties include up to $2500 per download of each app by California consumers. Major app companies Amazon, Apple, Google, Hewlett-Packard, Microsoft, and Research in Motion have already agreed to ensure their mobile app privacy policies are in accordance with California law. As Wilson Sonini explains in a recent Client Alert, letter recipients have 30 days respond with how they intend to comply.