November 2020
AGG’s Government Investigations Team Insights provides periodic updates covering legal and regulatory topics. Our team, which includes former federal prosecutors, SEC enforcement attorneys, and federal agency attorneys, has successfully represented companies and individuals, including executives of public companies, in numerous civil and criminal investigations, including before the U.S. Department of Justice and U.S. Attorney’s Offices, the SEC, the EPA, the FDA, the FTC, and many other federal and state agencies. We also assist our clients by conducting internal and parallel investigations, and advising them regarding the related issues that often follow government investigations, including civil litigation, media interest, and reputational concerns.
In this edition, we review the likely white collar enforcement priorities for the Biden Administration, analyze the Small Business Administration’s new PPP Loan Necessity Questionnaires, assess the impact of recent SEC enforcement proceedings against former Wells Fargo senior executives, and discuss new rules governing the EPA’s use of agency guidance as evidence in enforcement actions.
FEATURED ARTICLES
Alan G. Minsk, Adriaen M. Morse Jr., Rebekah N. Plowman, and John P. Rowley III
SEC’s Investigation into Wells Fargo Concludes with Actions Against Senior Executives
By: Adriaen M. Morse Jr. and Cory C. Kirchert
On Friday, November 13, 2020, the U.S. Securities and Exchange Commission (“SEC” or “Agency”) followed up its February 2020 action against Wells Fargo & Co. (“Wells Fargo”) with actions against two senior officers—former Chairman and CEO of Wells Fargo, John Stumpf, who agreed to an SEC administrative cease and desist order, and $2.5 million in penalties, and former head of Wells Fargo’s Community Bank (“Community Bank”), Carrie Tolstedt, who did not settle with the SEC. The SEC filed a civil complaint in the U.S. District Court for the Northern District of California against her, claiming that Tolstedt had violated “the antifraud provisions of the federal securities laws” and seeking to have a “permanent injunction, civil penalties, disgorgement with prejudgment interest, and an officer-and-director bar” imposed against her. Read More >
EPA's New Rule Limiting the Use of "Guidance" May Make It Easier, or Harder, to Defend Against Enforcement Actions
President Trump issued an Executive Order on October 9, 2019, to make the use of guidance documents by federal agencies more transparent. The Environmental Protection Agency subsequently promulgated a final rule, effective November 18, 2020, to clarify how it will manage guidance documents consistent with the Executive Order. Guidance are memoranda, policy papers, or other documents that articulate an agency’s interpretations of laws, regulations, or policies, that have been vetted and approved within the agency but were not subject to public comment, and that do not have the legal force of a regulation or a law. Despite the fact that guidance is not legally enforceable, both EPA and the regulated community frequently rely on guidance to direct their decisions. Sometimes defendants decry EPA’s use of guidance as legal authority, arguing that an agency should not be allowed to rely on unsanctioned interpretations in enforcement actions. However, limiting EPA’s use of guidance may paradoxically lead to less transparency regarding Agency decisions and greater uncertainty in the regulated community. Read More >
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Aaron M. Danzig Partner, Atlanta Office 404.873.8504 aaron.danzig@agg.com |
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Sara M. Lord Partner, DC Office 202.677.4054 sara.lord@agg.com |
The information presented provides a general summary and/or recent legal and regulatory developments. It is not intended to be, and should not be relied upon as legal advice.
