Fintech : Law360 : Legal News & Analysis (2024)

Paycom Brass Face Investor Suit Over Future Revenue Woes

The top brass of human resources technology company Paycom Software Inc. have been hit with a shareholder derivative suit alleging that executives failed to disclose that a new product to streamline payroll processes was threatening its future revenue by helping companies avoid errors they would otherwise pay to fix.

Steptoe LLP has hired a former Miller & Chevalier Chtd. member, who joins the firm to lead its U.S. Securities and Exchange Commission enforcement practice in the firm's Washington and New York offices.

Russian Charged Over $100M LockBit Ransomware Scheme

Federal prosecutors said Tuesday they have charged a Russian national with founding and heading the prolific ransomware group LockBit, which is accused of stealing more than $100 million from its victims.

FDIC Review Flags 'Patriarchal' Workplace, Chief's 'Temper'

The Federal Deposit Insurance Corp.'s workplace culture has suffered "far too long" from sexual harassment, discrimination and other abuses that higher-ups failed to adequately address, according to a report released Tuesday that is drawing renewed calls for FDIC Chairman Martin Gruenberg's exit.

Coinbase Operates As Unregistered Broker, Investors Say

Coinbase and its CEO have been hit with a proposed class action in California federal court alleging the crypto exchange "has been a part of a shadowy crypto ecosystem operating just outside of the law since formed over 10 years ago."

Crypto Platform's Ex-Brass Charged With $783M Fraud

Three former executives behind bankrupt cryptocurrency investment platform Cred Inc. face wire fraud and money laundering charges after they allegedly lied to customers about the firm's lending and investing practices ahead of a collapse prosecutors say wiped out $783 million in customer crypto.

SEC's Grewal Says Self-Reporting Best Bet For No Penalties

Self-reporting is the most important factor that U.S. Securities and Exchange Commission enforcement staff weigh in determining cooperation credit and whether a firm should face a penalty, SEC Enforcement Director Gurbir Grewal said in an interview with Law360.

SEC Small Biz Panel Urges Relaxed Rules For Crowdfunding

A U.S. Securities and Exchange Commission advisory committee recommended Monday that regulators raise the threshold at which equity crowdfunding issuers must obtain an independent review of financial statements, hoping to encourage the use of crowdfunding for cash-strapped entrepreneurs.

FDIC, OCC Gear Up For Another Shot At Banker Bonus Rules

The Federal Deposit Insurance Corp. and Office of the Comptroller of the Currency on Monday revived an Obama-era proposal to set restrictions on incentive-based pay for executives at big banks, a lingering item of unfinished Dodd-Frank Act business, and for now, the Federal Reserve is sitting out.

SEC Targets Robinhood's Crypto Unit For Possible Lawsuit

Robinhood Markets Inc. notified investors Monday that the U.S. Securities and Exchange Commission plans to sue its crypto arm for allegedly failing to register as a securities brokerage firm and clearing agency, saying the agency could go as far as demanding that the platform be shut down.

Binance Founder's Sentence Shaped By Plea And Apology

Binance founder Changpeng Zhao's willingness to cooperate with law enforcement and accept responsibility in court for the crypto exchange's anti-money laundering violations helped the former CEO land a deal with prosecutors that got him a relatively short prison sentence to close out a yearslong investigation.

NY's Citi Suit Imperils Wire Transfer Market, Bank Groups Say

Major banking trade groups are backing Citibank NA in its fight against the New York attorney general's lawsuit over the bank's payment fraud protocols, warning that the state's claims seek to change how wire transfers are regulated in a way that could "upend" the marketplace for such services.

5th Circ. Stands By Keeping CFPB Late Fee Case In Texas

A Fifth Circuit panel will not reconsider its decision rejecting the cross-country transfer of a bank industry-backed challenge to the Consumer Financial Protection Bureau's $8 credit card late fee standard, denying the agency's bid to move the case back to Washington, D.C., from Texas.

Charities Can't Get 'Second Bite Of The Apple' Against PayPal

An Illinois federal judge on Friday trimmed a second lawsuit by charities challenging the way PayPal solicits and distributes charitable contributions, saying they can't get a "second bite of the apple" after their nearly identical claims were dismissed because they'd agreed to individually arbitrate disputes.

​​​​​​​Biden's AI Guidance For Gov't May Need More Risk Controls

The Biden administration's latest guidance for federal agencies' purchases of generative artificial intelligence technologies doesn't fully account for risks such as systems failing to work as intended, and could therefore fail to deter agencies from ill-advised investments, according to experts.

BTC-e Mastermind Cops To Money Laundering Conspiracy

A Russian national pled guilty Friday to conspiracy to commit money laundering related to his central role in operating the cryptocurrency exchange BTC-e from 2011 to 2017, according to the U.S. Attorney's Office for the Northern District of California.

Fed. Circ. Says PTAB Rightly Axed Some Ioengine IP Claims

The Federal Circuit has backed the Patent Trial and Appeal Board's finding that invalidated numerous Ioengine LLC patent claims on card reader technology challenged by Ingenico Inc.

Sentencing Delayed For Ex-Fintech Exec In Crypto Case

Sentencing for the CEO of fintech company Hydrogen Technology Corp. was delayed Friday after a dispute over how to calculate the amount of money lost in the conspiracy to manipulate the market for Hydrogen's digital assets.

Fintech Co. Says PNC Acknowledged Use Of Logo For Years

Fintech company Plaid Inc. tried to fend off PNC Bank's allegations it tricked customers into handing over confidential account information, telling a Pennsylvania federal judge on Friday that the bank knew its trademarks were being used on Plaid's system.

SoFi Unit To Pay FINRA $1.1M To Settle Customer ID Claims

SoFi Securities has agreed to pay $1.1 million to settle Financial Industry Regulatory Authority claims that it lacked a suitable user verification process for the firm's cash management brokerage business, allowing the opening of 800 accounts used by third parties to illegally transfer $8.6 million from other financial institution accounts.

Kwok's Ex-Chief Of Staff Pleads Out Before $1B Fraud Trial

The former chief of staff to exiled Chinese billionaire Ho Wan Kwok pled guilty in Manhattan federal court on Friday to participating in a $1 billion investor fraud, less than three weeks before she was scheduled to go to trial alongside her erstwhile boss.

Wells Fargo Discloses Zelle Dispute-Handling Scrutiny

Wells Fargo & Co. on Thursday became the latest financial institution to disclose government scrutiny of how customers' dispute claims for potentially mistaken or fraudulent instant payments are being handled.

No Atty Fees For Objectors To $5.6B Swipe Fees Settlement

Class members who initially objected to a $5.6 billion settlement with Visa and Mastercard cannot collect nearly $1 million in attorney fees, a New York federal judge ruled Thursday, saying they haven't shown their objections to the original 2013 settlement substantially benefited the class.

Tech, Finance Experts Urge CFTC To Consider AI Regs

Tech advisers urged the U.S. Commodity Futures Trading Commission on Thursday to consider policies to manage the risks associated with artificial intelligence, along with a list of other recommendations detailing potential approaches to the growing use of AI in financial markets.

Attys Due For Spam Suit Sanction, But Not $750K, Judges Say

Class counsel's misconduct in helping instigate a spam text suit against stock-trading app Robinhood Financial LLC warranted sanctions, a Washington state appeals court panel ruled Thursday, but the judges said the $750,000 penalty went over the top in deterring the bad behavior.