Three news to start your week: December 4
US Supreme Court signals it could limit SEC in-house enforcement
(Reuters)
Conservative US Supreme Court justices indicated that they were skeptical of the legitimacy of some internal proceedings by the Securities and Exchange Commission to enforce investor protection laws, as they could further weaken the authority of federal agencies.
The court, which has a conservative 6-3 majority, heard arguments in an appeal filed by the administration of President Joe Biden regarding a lower court's decision that declared the SEC's tribunal proceedings before administrative judges, who are appointed by the agency and can impose financial penalties for infractions, unconstitutional.
The conservative justices emphasized a portion of the 2022 decision of the 5th US Circuit Court of Appeals in New Orleans, which concluded that in-house proceedings infringed upon the right to a jury trial guaranteed by the Seventh Amendment to the United States Constitution.
The SEC's system was contested by Texas-based hedge fund manager George Jarkesy, who was found guilty of securities fraud, punished by the agency, and banned from the industry.
Cristiano Ronaldo faces $1 billion lawsuit over Binance ads
(BBC)
Cristiano Ronaldo is involved in a class action lawsuit in the US due to his promotion of Binance, the largest cryptocurrency exchange. The lawsuit claims Ronaldo's endorsement led to loss-making investments, with damages sought exceeding $1 billion.
In November 2022, Ronaldo and Binance launched a "CR7" NFT collection, named after his initials and jersey number. However, the value of these NFTs significantly dropped within a year. The plaintiffs argue that Ronaldo's promotion increased interest in Binance and investments in what they consider "unregistered securities." They allege that Ronaldo failed to disclose his payment for the endorsement, a potential violation of US Securities and Exchanges Commission (SEC) regulations.
The SEC emphasizes the importance of transparency in celebrity endorsements. The case underscores the broader issue of inadequate regulatory guidelines in the evolving cryptocurrency market.
CFPB Orders Bank of America to Pay $12 Million for Reporting False Mortgage Data
(CFPB)
By an established federal statute, Bank of America was ordered today to pay a $12 million penalty by the Consumer Financial Protection Bureau (CFPB) for providing false information to the federal government about mortgage lending.
Hundreds of Bank of America loan officers falsely reported that mortgage applicants had declined to answer when they neglected to ask specific demographic questions mandated by federal law for at least four years. Bank of America is required by the CFPB's order to deposit $12 million into the organization's victims relief fund.
Director of the CFPB Rohit Chopra stated, "Bank of America violated a federal law that thousands of mortgage lenders have routinely followed for decades." "It is illegal to report false information to federal regulators, and we will be taking additional steps to ensure that Bank of America stops breaking the law."
