On October 19, 2016, South Korean prosecutors announced the indictment of 22 Lotte Group officials, including the chairman, for embezzlement, tax evasion, and other corporate malfeasance following a four month corruption probe.
SEC to Propose Corporate Election Reform
The United States Securities and Exchange Commission recently announced that it would consider proposing amendments to the disclosure requirements imposed in corporate director elections. The amendment would alter the ways in which investors nominate and elect members to the company’s board of directors in contested elections. By focusing on a universal ballot with a single voting form, the SEC hopes to make it easier for shareholders to exercise control over the company’s management. This would be a rather dramatic deviation from the current practice wherein voters receive two separate ballots representing a competing group of board candidates.
SEC Prepares Regulatory Review into the Exchange Traded Fund Industry
The Securities and Exchange Commission (SEC) is preparing for a full-scale review of the exchange-traded fund (ETF) industry, an unnamed source told the Financial Times in an article published October 20, 2016.
Wells Fargo Targets the Weak
On September 8, 2016, Wells Fargo agreed to pay $185 million in fines as a result of illegal banking practices its employees had engaged in for years. Since as early as 2005, Wells Fargo employees opened about two million unauthorized bank accounts and sent out countless unsolicited credit cards.
Practitioner Speaker Series: Benson Cohen, Sidley Austin
On October 31, 2016, The Berkeley Center for Law, Business and the Economy (BCLBE) hosted Benson Cohen, partner at the New York office of Sidley Austin, to discuss his law practice. Mr. Cohen is a ’04 Boalt alumnus, serving on the Boalt Hall Alumni Association’s board of directors. He is also the current chair of the nominating committee for the New York City Bar Association’s “Diversity and Inclusion Champion Award.” In addition to many other awards, his practice team at Sidley Austin has been awarded first-tier national rankings by the US News—Best Lawyers for Private Funds/Hedge Funds Law and Derivatives and Futures Law.
Event Recap: Ryan Horning, Assistant General Counsel to the Oakland Athletics
On November 2, 2016, the Berkeley Center for Law Business and the Economy hosted a lunchtime lecture by Ryan Horning, the Assistant General Counsel to the Oakland Athletics.
Wal-Mart Rejects Government Settlement of $600 Million
After spending five years investigating allegations that Wal-Mart representatives bribed government officials over the course of a ten-year period to fast-track store openings, the United States government has finally put a settlement offer on the table.
Court Removes Restriction on President’s Power to Remove CFPB Director
The D.C. Circuit recently held that that the Consumer Financial Protection Bureau (CFPB), an independent agency established by the Dodd Frank Act, was unconstitutionally structured because it was a single director agency whose director was only removable by the President for cause. The court resolved this unconstitutionality by striking down the “for cause” requirement that limited the President’s removal power, and severed it from the Act.
Clawbacks—Not the Punitive Threat They Were Thought to Be
When employees are offered incentives such as bonuses, stock options, or other types of rewards, companies may establish provisions that allow recovery of part or all of the incentives offered. These types of policies are known as “clawbacks.” Such policies seek to encourage executives to abstain from certain kinds of conduct that are viewed as negative, unnecessary, or otherwise undesired by directors and shareholders. For example, companies that operate in the financial industry adopt these policies in cases where executives could harm the company by taking excessive risks or engaging in behavior that embarrasses the company.
With Profits and Consolidation on The Rise, Will Antitrust Litigation Follow?
During the 2016 election cycle, much has been made of the economy and how it appears to be rigged against the little guy. Both presidential candidates have been trying to position themselves as the solution for bringing profits back to Main Street and cleaning up “big business.” During the Democratic primaries, Bernie Sanders based his campaign on the very idea that the U.S. needed a political and economic revolution, and recent political superstars, such as Elizabeth Warren, have been ringing the bell of economic reform for the past two years. There is evidence that this is not simply politicians attempting to draw policy distinctions among themselves, but a true reflection of what Americans are feeling. According to the Pew Research Center, the economy is the number one concern among likely voters with 84 percent listing it as “highly likely” to influence their vote in the 2016 election. There is no doubt that much of this is rooted in the belief that the economy is rigged against the average American in favor of large corporations. Recent polling has found that over 70 percent of Americans believe that the economy is rigged in favor of certain groups.