SEC fines NY firm deVere $8 million over UK pension advice conflicts

DeVere USA Inc has agreed to pay an $8 million civil fine to settle charges with the Securities and Exchange Commission (SEC) alleging that it failed to disclose conflicts of interest to hundreds of clients with UK pensions. Benjamin Alderson, 40, and Bradley Hamilton, 36, British citizens who until last year were deVere’s chief executive and a deVere manager, were also charged by the SEC with concealing the conflicts and misleading clients.

DeVere advised US residents who once worked in Britain on the transfer of pension assets to overseas retirement plans that qualified for special British tax treatment. From June 2013 to March 2016, the SEC said, deVere concealed arrangements with outside service providers related to that advice that resulted in payments to the firm. The firm has not admitted or denied any wrongdoing. 

CFTC urges judge to rule virtual currency as a commodity

The Commodity Futures Trading Commission (CFTC) has urged a federal judge to conclude that My Big Coin, a virtual currency, is a commodity and merely a digital alternative to precious metals such as silver and gold. In line with increased attempts by US regulators to pursue potentially fraudulent companies, the CFTC sued Randall Crater in January, accusing him and his company My Big Coin of defrauding potential investors of $6 million by giving their currency a name similar to bitcoin and purporting it was backed by gold.

The case is being closely watched as if virtual currencies are regarded as commodities, this will provide the CFTC with authority to police cryptocurrency frauds. Counsel for Mr Crater argued that My Big Coin is not a commodity under the Commodity Exchange Act as it is neither a tangible good nor a service on which future contracts are being traded. 

SEC: Ponzi scheme shut down

The SEC has filed charges in federal district court in Manhattan and obtained an asset freeze against the individuals and companies behind a $102 million Ponzi scheme. According to the SEC’s complaint, the defendants defrauded more than 600 investors through sales of securities in issuers they controlled. 

House Financial Services Committee: Illicit use of VCs

The House Financial Services Committee Subcommittee on Terrorism and Illicit Finance held a hearing on the problems law enforcement agencies encounter in their efforts to address the illicit funding potential of virtual currencies (VCs). A press release from the Subcommittee highlights topline quotes from witnesses and the following key takeaways:

  • while the majority of VC transactions are legitimate business transactions, the allure of perceived anonymity, ease of transacting across any distance and speed of resolution at low cost make VCs very attractive to criminals and terrorists;
  • law enforcement has identified an uptick in criminal and terrorist exploitation of VCs to raise funds and launder money; and
  • law enforcement needs to be equipped to respond to the rising use of VCs and the popularity of these methods to transfer money anonymously.