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SEC Proposes Rules to Enhance and Standardize Climate-Related Disclosures for Investors

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Administrator
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"Climate Emergency - Families facing Climate Change" by John Englart (Takver) is marked with CC BY-SA 2.0.

Washington D.C., March 21, 2022 —

The Securities and Exchange Commission today proposed rule changes that would require registrants to include certain climate-related disclosures in their registration statements and periodic reports, including information about climate-related risks that are reasonably likely to have a material impact on their business, results of operations, or financial condition, and certain climate-related financial statement metrics in a note to their audited financial statements. The required information about climate-related risks also would include disclosure of a registrant’s greenhouse gas emissions, which have become a commonly used metric to assess a registrant’s exposure to such risks.

“I am pleased to support today’s proposal because, if adopted, it would provide investors with consistent, comparable, and decision-useful information for making their investment decisions, and it would provide consistent and clear reporting obligations for issuers,” said SEC Chair Gary Gensler. “Our core bargain from the 1930s is that investors get to decide which risks to take, as long as public companies provide full and fair disclosure and are truthful in those disclosures. Today, investors representing literally tens of trillions of dollars support climate-related disclosures because they recognize that climate risks can pose significant financial risks to companies, and investors need reliable information about climate risks to make informed investment decisions. Today’s proposal would help issuers more efficiently and effectively disclose these risks and meet investor demand, as many issuers already seek to do. Companies and investors alike would benefit from the clear rules of the road proposed in this release. I believe the SEC has a role to play when there’s this level of demand for consistent and comparable information that may affect financial performance. Today’s proposal thus is driven by the needs of investors and issuers.”

The proposed rule changes would require a registrant to disclose information about (1) the registrant’s governance of climate-related risks and relevant risk management processes; (2) how any climate-related risks identified by the registrant have had or are likely to have a material impact on its business and consolidated financial statements, which may manifest over the short-, medium-, or long-term; (3) how any identified climate-related risks have affected or are likely to affect the registrant’s strategy, business model, and outlook; and (4) the impact of climate-related events (severe weather events and other natural conditions) and transition activities on the line items of a registrant’s consolidated financial statements, as well as on the financial estimates and assumptions used in the financial statements.

For registrants that already conduct scenario analysis, have developed transition plans, or publicly set climate-related targets or goals, the proposed amendments would require certain disclosures to enable investors to understand those aspects of the registrants’ climate risk management.

The proposed rules also would require a registrant to disclose information about its direct greenhouse gas (GHG) emissions (Scope 1) and indirect emissions from purchased electricity or other forms of energy (Scope 2). In addition, a registrant would be required to disclose GHG emissions from upstream and downstream activities in its value chain (Scope 3), if material or if the registrant has set a GHG emissions target or goal that includes Scope 3 emissions. These proposals for GHG emissions disclosures would provide investors with decision-useful information to assess a registrant’s exposure to, and management of, climate-related risks, and in particular transition risks. The proposed rules would provide a safe harbor for liability from Scope 3 emissions disclosure and an exemption from the Scope 3 emissions disclosure requirement for smaller reporting companies. The proposed disclosures are similar to those that many companies already provide based on broadly accepted disclosure frameworks, such as the Task Force on Climate-Related Financial Disclosures and the Greenhouse Gas Protocol.

Under the proposed rule changes, accelerated filers and large accelerated filers would be required to include an attestation report from an independent attestation service provider covering Scopes 1 and 2 emissions disclosures, with a phase-in over time, to promote the reliability of GHG emissions disclosures for investors.

The proposed rules would include a phase-in period for all registrants, with the compliance date dependent on the registrant’s filer status, and an additional phase-in period for Scope 3 emissions disclosure.

The proposing release will be published on SEC.gov and in the Federal Register. The comment period will remain open for 30 days after publication in the Federal Register, or 60 days after the date of issuance and publication on sec.gov, whichever period is longer.

Press release distributed by the SEC.

Featured image by “Climate Emergency – Families facing Climate Change” by John Englart (Takver) is marked with CC BY-SA 2.0.

DTLA residents arrested in connection with COVID-19 relief fraud scheme

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Administrator
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"Downtown Los Angeles" by channone is marked with CC BY 2.0.

Los Angeles – Two downtown Los Angeles residents were arrested on a federal criminal complaint alleging they fraudulently obtained more than $300,000 – and attempted to obtain an additional $1 million – in COVID-relief loans for several companies they claimed to own and operate.

Sean Schoepflin, 42, a.k.a. “Sean Fitzgerald,” and Erika Leon, 44, a.k.a. “Erika Fitzgerald,” are each charged with one count of wire fraud, according to a complaint that was unsealed today. They are expected to make their initial appearances this afternoon in United States District Court.

According to an affidavit filed with the complaint, from April 2020 to October 2021, Schoepflin and Leon made numerous false statements to the United States Small Business Administration to secure more than $300,000 – and attempt to secure an additional $1 million – in Economic Injury Disaster Loans (EIDLs) for their businesses.

Schoepflin and Leon allegedly falsely stated that the business entities they created had several employees and several hundred thousand dollars in revenues, and that they would use the EIDLs for working capital for those businesses. Schoepflin also allegedly falsely stated on loan applications that he had never been convicted of a felony.

In fact, their purported businesses – Capital Adventures Inc., Lady Capital Inc., Digital Army Ltd., and Lady Pictures LLP – had no employees and little to no revenue, they used the EIDLs largely for personal expenses, and Schoepflin had previously been convicted of multiple felonies.

For example, Schoepflin falsely stated in one loan application that Capital Adventures had revenues of $560,000 in the 12-month period from February 1, 2019 to January 31, 2020, the affidavit alleges. In June 2020, when an SBA employee sent an email to Schoepflin requesting Capital Adventures’ business tax return to show proof of the company’s existence as a business entity, Schoepflin allegedly sent an unsigned tax form that stated that Capital Adventures had gross sales or receipts of $625,112 in 2019.

In fact, Capital Adventures did not file an IRS Form 1120 for 2019 until July 2021, after it requested and was denied an increase for its EIDL, according to the affidavit. Furthermore, between February 2018 and April 2020, Capital Adventures’ bank accounts had total deposits of approximately $35,000.

The FBI and the Treasury Inspector General for Tax Administration investigated this matter. The Small Business Administration Office of Inspector General provided substantial assistance with the investigation.

Assistant United States Attorneys David Ryan and Solomon Kim of the Terrorism and Export Crimes Section are prosecuting this case.

The Coronavirus Aid, Relief, and Economic Security (CARES) Act was designed to provide emergency financial assistance to millions of Americans who are suffering the economic effects resulting from the COVID-19 pandemic. One source of relief provided by the CARES Act is the authorization of up to $349 billion in forgivable loans to small businesses for job retention and certain other expenses through the PPP. In April, Congress authorized more than $300 billion in additional PPP funding.

The EIDL program is designed to provide economic relief to small businesses that are currently experiencing a temporary loss of revenue. EIDL proceeds can be used to cover a wide array of working capital and normal operating expenses, such as continuation of health care benefits, rent, utilities, and fixed-debt payments.

Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud Hotline at (866) 720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.

Press release distributed by the FBI.

Featured image: “Downtown Los Angeles” by channone is marked with CC BY 2.0.

SEC proposes rules on cybersecurity risk management, strategy, governance, and incident disclosure by public companies

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Administrator
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"13th annual Cyber Defense Exercise_04" by West Point - The U.S. Military Academy is marked with CC BY-NC-ND 2.0.

Washington D.C. — The Securities and Exchange Commission has proposed amendments to its rules to enhance and standardize disclosures regarding cybersecurity risk management, strategy, governance, and incident reporting by public companies.

“Over the years, our disclosure regime has evolved to reflect evolving risks and investor needs,” said SEC Chair Gary Gensler. “Today, cybersecurity is an emerging risk with which public issuers increasingly must contend. Investors want to know more about how issuers are managing those growing risks. A lot of issuers already provide cybersecurity disclosure to investors. I think companies and investors alike would benefit if this information were required in a consistent, comparable, and decision-useful manner. I am pleased to support this proposal because, if adopted, it would strengthen investors’ ability to evaluate public companies’ cybersecurity practices and incident reporting.”

The proposed amendments would require, among other things, current reporting about material cybersecurity incidents and periodic reporting to provide updates about previously reported cybersecurity incidents. The proposal also would require periodic reporting about a registrant’s policies and procedures to identify and manage cybersecurity risks; the registrant’s board of directors’ oversight of cybersecurity risk; and management’s role and expertise in assessing and managing cybersecurity risk and implementing cybersecurity policies and procedures. The proposal further would require annual reporting or certain proxy disclosure about the board of directors’ cybersecurity expertise, if any.

The proposed amendments are intended to better inform investors about a registrant’s risk management, strategy, and governance and to provide timely notification to investors of material cybersecurity incidents.

The proposing release will be published on SEC.gov and in the Federal Register. The comment period will remain open for 60 days following publication of the proposing release on the SEC’s website or 30 days following publication of the proposing release in the Federal Register, whichever period is longer.

Press release distributed by the SEC.

Featured image: “13th annual Cyber Defense Exercise_04” by West Point – The U.S. Military Academy is marked with CC BY-NC-ND 2.0.

Father and son convicted of COVID-19 PPP fraud

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Administrator
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"Justice Gavel" by toridawnrector is marked with CC BY-SA 2.0.

A federal jury in the Western District of North Carolina convicted two men this week for the submission of fraudulent loan applications seeking more than $1.7 million in forgivable Paycheck Protection Program (PPP) loans guaranteed by the Small Business Administration (SBA) under the Coronavirus Aid, Relief and Economic Security (CARES) Act.

According to evidence presented during a six-day trial, Izzat Freitekh, 55, of Waxhaw, North Carolina, and his son Tarik Freitekh, aka Tareq Freitekh, 33, whose last known residence was in Glendale, California, obtained $1.7 million by submitting multiple fraudulent PPP loan applications for companies owned by Izzat Freitekh: La Shish Kabob, La Shish Kabob Catering, Green Apple Catering, and Aroma Packaging. The loan applications misrepresented the number of employees and payroll expenses. After obtaining the fraudulent loan proceeds, the defendants engaged in unlawful monetary transactions with the proceeds of the scheme, including making $30,000 payments to family members.

Izzat Freitekh was convicted of one count of conspiracy to commit money laundering, three counts of money laundering, and one count of making false statements. He faces up to 10 years in prison for conspiracy to commit money laundering, 10 years in prison for each of the money laundering counts, and five years in prison for the false statements count.

Tarik Freitekh was convicted of one count of conspiracy to commit wire fraud, one count of bank fraud, one count of conspiracy to commit money laundering, one count of money laundering, and one count of falsifying and concealing material facts. He faces up to 30 years in prison for the bank fraud count, 20 years in prison for the wire fraud and money laundering conspiracies, 10 years in prison for the money laundering count, and five years in prison for the falsifying material facts count.

A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Assistant Attorney General Kenneth A. Polite Jr. of the Justice Department’s Criminal Division; U.S. Attorney Dena J. King for the Western District of North Carolina; Inspector in Charge Tommy Coke of the U.S. Postal Inspection Service, Atlanta Division; Special Agent in Charge Donald E. Eakins of IRS Criminal Investigation (IRS-CI), Charlotte Field Office; and Special Agent in Charge Mark Morini of the U.S. Treasury Inspector General for Tax Administration (TIGTA), Southeast Field Division, made the announcement.

The US Postal Inspection Service, IRS-CI, and TIGTA investigated the case.

Trial Attorneys Joshua N. DeBold and Matt Kahn of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Mark Odulio of the Western District of North Carolina prosecuted the case.

On May 17, 2021, the Attorney General established the COVID-19 Fraud Enforcement Task Force to marshal the resources of the Department of Justice in partnership with agencies across government to enhance efforts to combat and prevent pandemic-related fraud. The Task Force bolsters efforts to investigate and prosecute the most culpable domestic and international criminal actors and assists agencies tasked with administering relief programs to prevent fraud by augmenting and incorporating existing coordination mechanisms, identifying resources and techniques to uncover fraudulent actors and their schemes, and sharing and harnessing information and insights gained from prior enforcement efforts. For more information on the department’s response to the pandemic, please visit https://www.justice.gov/coronavirus.

Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud (NCDF) Hotline via the NCDF Web Complaint Form at https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.

Press release distributed by the DOJ.

Featured image: “Justice Gavel” by toridawnrector is marked with CC BY-SA 2.0.

SEC Issues Awards Totaling Approximately $3 Million to Three Whistleblowers

By
Administrator
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reg d 506 (c)

Washington D.C. – The Securities and Exchange Commission today announced three awards totaling approximately $3 million to whistleblowers who provided information and assistance in three separate covered actions.

In the first order, the SEC issued an award of approximately $1.5 million to a whistleblower who provided new information that caused the SEC staff to commence an examination and later open a new investigation into potential securities laws violations. The whistleblower also assisted the staff during the course of the investigation.

In the second order, the SEC awarded a whistleblower more than $1 million for providing information that prompted the opening of an investigation. The whistleblower, an insider who also reported concerns internally, provided continuing assistance to the staff, including multiple interviews.

In the third order, the SEC awarded more than $400,000 to a whistleblower whose comprehensive tip led to an investigation, and thereafter provided substantial ongoing cooperation. The whistleblower also raised concerns internally, causing the conduct to cease.

“Whistleblowers are instrumental to the agency’s ability to detect wrongdoing,” said Creola Kelly, Chief of the SEC’s Office of the Whistleblower. “Each of today’s whistleblowers alerted SEC staff to the securities laws violations and then provided essential assistance that aided the investigation.”

The SEC has awarded approximately $1.2 billion to 254 individuals since issuing its first award in 2012. All payments are made out of an investor protection fund established by Congress that is financed entirely through monetary sanctions paid to the SEC by securities law violators. No money has been taken or withheld from harmed investors to pay whistleblower awards.  Whistleblowers may be eligible for an award when they voluntarily provide the SEC with original, timely, and credible information that leads to a successful enforcement action.  Whistleblower awards can range from 10 percent to 30 percent of the money collected when the monetary sanctions exceed $1 million.

As set forth in the Dodd-Frank Act, the SEC protects the confidentiality of whistleblowers and does not disclose any information that could reveal a whistleblower’s identity.

For more information about the whistleblower program and how to report a tip, visit www.sec.gov/whistleblower.

Press release distributed by the SEC.

New York man defrauds thousands of consumers in direct-mail cash prize scheme

By
Administrator
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"Money Roll - $100 Dollar Bills" by 401(K) 2013 is marked with CC BY-SA 2.0.

Three Defendants Have Pleaded Guilty to Fraud Conspiracy

A New York resident has pleaded guilty in the Eastern District of New York to participating in a fraudulent multimillion-dollar mass-mailing scheme that tricked consumers into paying fees for falsely promised cash prizes.

According to court documents, from August 2014 through August 2019, Scott Gammon, 47, of Broad Channel, New York, engaged in a direct-mail scheme that sent fraudulent prize notification mailings to thousands of consumers. The mailings induced consumers to pay a fee, purportedly in return for a large cash prize. None of the consumers who sent a fee ever received such a prize. Gammon is the third defendant to plead guilty to conspiracy to commit mail fraud in connection with this scheme.

“Fraudulent prize notices often cause victims, including the elderly, to send money based on false promises of large cash prizes,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “This guilty plea is the latest example of the Department of Justice continuing to pursue and prosecute the perpetrators of these schemes.”

“The defendant admitted he deceived elderly and vulnerable victims into believing they had won cash prizes by inducing them to pay bogus ‘fees’ to him and his co-conspirators,” stated U.S. Attorney Breon Peace for the Eastern District of New York. “This office will continue to protect our seniors and other consumers from harm caused by predatory solicitation schemes.”

“Postal Inspectors remind consumers, if you have to pay to win a prize, you’ll lose your money,” said Inspector in Charge Daniel B. Brubaker of the U.S. Postal Inspection Service. “These are all scams designed to lure consumers into sending their hard-earned money — not for a prize, but to fatten the pockets of a fraudster. Mr. Gammon may have thought he got away with this scheme, but he was sadly mistaken when he was confronted by the full investigative power of law enforcement.”

Two other defendants previously pleaded guilty to conspiracy to commit mail fraud for participating in the scheme. Christopher King, 36, of Oceanside, New York, pleaded guilty on Sept. 15, 2021. Natasha Khan, 38, of Elmont, New York, pleaded guilty on Dec. 15, 2021.

Gammon’s plea took place before Magistrate Judge Steven I. Locke. Gammon is scheduled to be sentenced at a later date. Each of the three defendants faces a maximum penalty of 20 years in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

The U.S. Postal Inspection Service investigated the case.

Trial Attorneys Daniel Zytnick and Timothy Finley of the Civil Division’s Consumer Protection Branch and Assistant U.S. Attorney Charles P. Kelly of the U.S. Attorney’s Office for the Eastern District of New York are prosecuting the case.

Additional information about the Consumer Protection Branch and its enforcement efforts may be found at www.justice.gov/civil/consumer-protection-branch.

Press release distributed by the DOJ.

Featured image: “Money Roll – $100 Dollar Bills” by 401(K) 2013 is marked with CC BY-SA 2.0.

Adam Rogas raised $123M from investors using phony financial statements

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Administrator
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"Numbers And Finance" by kenteegardin is marked with CC BY-SA 2.0.

Adam Rogas Raised $123 Million From Investors Using Financial Statements That Showed Tens of Millions of Dollars of Revenue and Assets that Did Not Exist

Damian Williams, the United States Attorney for the Southern District of New York, announced that ADAM ROGAS, the co-founder and former CEO, CFO, and member of the board of directors of Las Vegas-based cyberfraud prevention company NS8, Inc. (“NS8”), pled guilty today in Manhattan federal court to securities fraud. ROGAS used fraudulent financial data to obtain over $123 million in financing for NS8, of which he personally obtained approximately $17.5 million. ROGAS pled guilty today before U.S. District Judge John P. Cronan, and is scheduled to be sentenced by Judge Cronan on August 10, 2022.

U.S. Attorney Damian Williams said:  “Today, Adam Rogas admitted to being the proverbial fox guarding the henhouse.  While claiming to be in the fraud prevention business, Rogas himself defrauded investors in his company of over $100 million.  Now Rogas will be held accountable for his fraudulent scheme.”

According to the Complaint, Indictment, and other publicly-filed documents:

ADAM ROGAS was a co-founder of NS8, and served as its CEO, CFO, and a member of its board of directors.  ROGAS was also primarily responsible for the company’s fundraising activities.  NS8, which was based in Las Vegas, Nevada, was a cyberfraud prevention company that developed and sold electronic tools to help online vendors assess the fraud risks of customer transactions.  In the fall of 2019 and the spring of 2020, NS8 engaged in fundraising rounds through which it issued Series A Preferred Shares and obtained approximately $123 million in investor funds.

ROGAS maintained control over a bank account into which NS8 received revenue from its customers, and periodically provided monthly statements from that account to NS8’s finance department so that NS8’s financial statements could be created.  ROGAS also maintained control over spreadsheets that purportedly tracked customer revenue, which were also used to generate NS8’s financial statements.

ROGAS altered the bank statements before providing them to NS8’s finance department to show tens of millions of dollars in both customer revenue and bank balances that did not exist.  In the period from January 2019 through February 2020, between at least approximately 40% and 95% of the purported total assets on NS8’s balance sheet were fictitious.  In that same period, the bank statements that ROGAS altered reflected over $40 million in fictitious revenue.

statement

Altered (L) and original (R) bank statements for NS8’s revenue account.  Rogas altered statements for the account to show tens of millions of dollars in revenue (deposits) that did not exist.

ROGAS used these materially misleading financial statements to raise approximately $123 million from investors in the fall of 2019 and the spring of 2020.  During the fundraising process, ROGAS also provided the falsified bank records he had created to auditors who were conducting due diligence on behalf of potential investors.  After these fundraising rounds concluded, NS8 conducted a tender offer with the funds raised from investors, and ROGAS received $17.5 million in proceeds from that tender offer, personally and through a company he controlled.

***

ROGAS, 44, of Las Vegas, Nevada, pled guilty to one count of securities fraud, which carries a maximum sentence of 20 years in prison.  The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.

Mr. Williams praised the outstanding investigative work of the FBI in this investigation.  Mr. Williams further thanked the Securities and Exchange Commission for its cooperation and assistance in this investigation.

This case is being handled by the Office’s Securities and Commodities Fraud Task Force.  Assistant U.S. Attorneys Richard Cooper and Jared Lenow are in charge of the prosecution.

Press release distributed by the DOJ.

Featured image: “Numbers And Finance” by kenteegardin is marked with CC BY-SA 2.0.

The US announces increased international cooperation to target Russian assets

By
Administrator
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"city" by barnyz is marked with CC BY-NC-ND 2.0.

Australia, Canada, the European Commission, Germany, Italy, France, Japan, the UK, and U.S., Agree to Increased Cooperation to Target Russian Assets

Attorney General Merrick B. Garland and Secretary of the Treasury Janet L. Yellen today met virtually with representatives from Australia, Canada, Germany, France, Italy, Japan, the United Kingdom, and the European Commission, to launch the Russian Elites, Proxies, and Oligarchs (REPO) multilateral task force. The task force was first announced by leaders on Feb. 26.

The task force, consisting of Finance Ministry and Justice or Home Ministry in each member jurisdiction, each committed to using their respective authorities in concert with other appropriate ministries to collect and share information to take concrete actions, including sanctions, asset freezing, civil and criminal asset seizure, and criminal prosecution.

Cooperation between the U.S. government and foreign partners has already yielded notable successes. In the last three weeks alone, information provided by U.S. law enforcement to foreign partners has contributed to the restraint of multiple vessels controlled by sanctioned individuals and entities. Collectively, these vessels are estimated to be worth hundreds of millions of dollars.

“We are already working with our international partners to freeze and seize properties belonging to sanctioned Russian oligarchs worldwide,” said Attorney General Garland. “We will continue to work together to take all appropriate actions against those whose criminal acts enable the Russian government to continue its unjust war against Ukraine.”

“Our sanctions, trade restrictions, and other measures have already imposed significant costs on Russia, its leadership, and those who enabled Putin’s unprovoked invasion into Ukraine,” said Secretary Yellen. “This multilateral task force will raise those costs even more, by galvanizing coordinated efforts to freeze and seize assets of these individuals in jurisdictions around the world and deny safe haven for their ill-gotten gains.”

The REPO task force members discussed ways to ensure the effective, coordinated implementation of the group’s collective financial sanctions relating to Russia, as well as assistance to other nations to locate and freeze assets located within their jurisdictions. Participants also discussed the need to preserve evidence and determine whether these frozen assets, or other assets linked to these sanctioned individuals or entities, are subject to forfeiture. Finally, the task force discussed ways to bring to justice enablers and gatekeepers who have facilitated the movement of sanctioned assets or other illicit funds.

The Department of Justice’s newly launched Task Force KleptoCapture, which the Attorney General established on March 2, will help support this international effort. Task Force KleptoCapture is designed to help deploy U.S. prosecutorial and law enforcement resources to identify sanctions evasion and related criminal conduct.

In addition to the launch of the REPO task force, Treasury took steps to boost cooperation and intelligence sharing. Treasury’s Financial Crimes Enforcement Network (FinCEN) today will join in a statement with counterparts in task force member countries and others to increase information sharing. FinCEN will also release an alert for financial institutions about the importance of identifying and reporting suspicious transactions by sanctioned Russian elites, oligarchs, and their proxies that involve real estate, luxury goods, and high-value assets. FinCEN continues robust engagement with financial institutions through its public-private partnership authorities to enhance collaboration and information sharing and analysis.

Treasury will also launch the Kleptocracy Asset Recovery Rewards Program today, which offers rewards payments for information leading to seizure, restraint, or forfeiture of assets linked to foreign government corruption, including the Government of the Russian Federation. The Department of the Treasury’s Office of Terrorism and Financial Intelligence administers the Program in coordination with the Departments of Justice and State and U.S. federal law enforcement agencies. More information on eligibility for rewards payments and on submission of relevant information to the U.S. government can be found here. Those individuals with information are encouraged to contact Kleptocracy_Rewards@Treasury.gov or call +1 202-622-2050.

In connection with the meeting, Treasury is providing attendees with a list of 50 individuals who are priorities for the United States. Treasury has publicly released 28 names of individuals from the list who have been sanctioned by multiple jurisdictions, including the United States. The names are available here.

Press release distributed by the DOJ.

Featured image: “city” by barnyz is marked with CC BY-NC-ND 2.0.

Idaho Man Pleads Guilty for Role in Tribal Fraud Scheme

By
Aitana Vargas
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PORTLAND, Ore. — A resident of the Fort Hall Reservation in Idaho and former CEO of the Warm Springs Economic Development Corporation (WSEDC) has pleaded guilty for his role in a fraud scheme targeting the Confederated Tribes of Warm Springs.

Roderick Ariwite, 66, pleaded guilty to theft of funds from a tribal organization and interstate transportation of a security taken by fraud, resolving two separate criminal cases against him.

According to court documents, WSEDC, also known as Warm Springs Ventures (WSV), is a Tribal organization owned and operated by the Warm Springs Tribes. WSV operates as the management organization for several Tribal business entities, including the Warm Springs Construction Enterprise (WSCE).

Ariwite and an accomplice, Thomas Valentino Adams, 49, a Nevada resident and the former manager of WSCE, created a construction company called Warbonnet Construction Services LLC. While drawing tribal salaries and travel reimbursements, Ariwite and Adams engaged in work projects for Warbonnet. In 2018, Ariwite and Adams used tribal funds to hire a subcontractor for a Warbonnet project and submitted vouchers for expenses they incurred on behalf of themselves and Warbonnet, which were reimbursed with tribal funds. In total, Ariwite and Adams’ scheme cost the Warm Springs Tribes more than $50,000.

On September 24, 2020, a federal grand jury in Portland returned a six-count indictment charging Ariwite and Adams with conspiracy and theft of funds from a Tribal organization. In a separate indictment, Ariwite was charged with one count of interstate transportation of a security taken by fraud.

Ariwite faces a maximum sentence of 15 years in prison, a $500,000 fine and three years’ supervised release. He will be sentenced on June 6, 2022 before U.S. District Court Judge Michael W. Mosman.

As part of his plea agreement, Ariwite has agreed to pay $39,613 in restitution to the Warm Springs Tribes and $3,000 to an unnamed adult victim.

On August 23, 2021, Adams pleaded guilty to theft of funds from a Tribal organization. He will be sentenced on March 29, 2022 before Judge Mosman.

U.S. Attorney Scott Erik Asphaug of the District of Oregon made the announcement.

This case was investigated by the FBI with assistance from the Warm Springs Police Department. It was prosecuted by Meredith Bateman and Seth Uram, Assistant U.S. Attorneys for the District of Oregon.

Press release distributed by the DOJ.

Featured image: “under construction” by Pedro Moura Pinheiro is marked with CC BY-NC-SA 2.0.

Register for the SEC’s 41st Annual Small Business Forum to Impact Capital Raising Policy

By
Administrator
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Washington D.C. — The Office of the Advocate for Small Business Capital Formation will host the Securities and Exchange Commission’s 41st Annual Government-Business Forum on Small Business Capital Formation over four virtual sessions April 4-7 from 1:00-2-30pm ET. Each day will focus on a different topic and feature speakers with in-depth knowledge of the issues facing small businesses across the country, followed by an opportunity for participants to develop policy recommendations. Sessions will focus on the following topics:

  • Mon., April 4 – Empowering Entrepreneurs: Tools to Navigate Capital Raising
  • Tue., April 5 –  Hometown Entrepreneurship: How Entrepreneurs Can Thrive Outside of Traditional Capital Raising Hubs
  • Wed., April 6 – New Investor Voices: How Emerging Fund Managers Are Diversifying Capital
  • Thur., April 7 – Small Cap World: What to Know and How to Think Ahead

The Forum website will continue to be updated with details on the agenda, speakers, registration, and FAQs in the coming weeks leading up to the event.

“Each year we look forward to hosting the Small Business Forum and engaging with entrepreneurs, investors, and other thought leaders who are passionate about capital raising,” said Office Director Martha Legg Miller. “By providing a platform for Forum participants to develop capital raising policy recommendations, the SEC is able to keep a pulse on the real-world impact of our rules on communities across the country.”

Registration: Click here to register and receive a link to participate.

Policy Recommendations: The Forum provides an opportunity for the public to provide feedback and develop policy recommendations on capital raising. Like last year, participants are asked to submit policy ideas in advance to smallbusiness@sec.gov. At the end of each day’s session, attendees will have the opportunity to prioritize policy recommendations for that day’s topic. After the event, a report with the recommendations will be delivered to Congress.

About the Forum: The Forum is a unique event where members of the public and private sectors gather to provide feedback to improve capital raising policy for startups to smaller public companies and their investors. The Forum will feature appearances by each of the Commissioners, leaders from across the SEC, and an exciting line-up of speakers with fresh perspectives on capital raising. The 2021 Forum Report summarizing the proceedings and recommendations of participants was released on September 27, 2021.

Press release distributed by the SEC.

Featured image: “Wall Street” by Sjoerd van Oosten is marked with CC BY-NC-ND 2.0.

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