SEC enforcement

The SEC charged two entities with violating federal securities laws by advising clients on municipal bonds without properly registering as municipal advisors.

Randy Miller, 70, and Chad Miller, 41, entered guilty pleas Wednesday in the Legacy Cares securities fraud case and will be sentenced at a later date.

The SEC told the court it is leaving for later to settle financial terms with Jeffrey DeLaveaga.

"Settlor's remorse" is no justification for upsetting a settled order, SEC says.

It is sadly not possible to prevent 100% fraud scenarios from occurring; however, reassessing your firm's processes for identifying red flags may be a good place to start.  

The charges related to implementation and enforcement of material nonpublic information policies and Puerto Rico bonds.

As an alleged fraud scheme puts a spotlight on due diligence, some say it may be time to rethink practices in that area amid the rise of AI.

Fallout from the Legacy Cares deal includes bondholder lawsuits against the underwriter and bond counsel, payment defaults, a Chapter 11 bankruptcy, and now fraud charges from the SEC and DOJ.

The SEC and DOJ announced charges in connection with municipal bonds issued for the Legacy Cares sports complex in Arizona, which defaulted and went bankrupt.

SEC probe relating to a cyberattack on a Michigan township's bond sale could involve looking into whether investors are getting an accurate picture of the issuer's credit risk, a former SEC enforcement attorney said.