We noted with interest the latest moves by some Bay Area tech giants to permit their employees to sell restricted stock to help them realize the stock value as part of their compensation: See New York Times reporting here. It should come as no surprise that private company employees in our tech economy rely on their potential restricted stock value as an important part of their compensation package, and also their decision whether to work for, or stay working for, one of the “hot” pre-IPO companies (which are legion in Northern California). What may surprise private companies is that this kind of restricted stock sale by employees creates a very easy “in” for the SEC to bring a case should any hidden compliance failures or fraud later be revealed.
Continue Reading Private Company Employee Stock Sales Highlight Hidden Dangers of Compliance Failures

Every day corporate entities and individuals in some parts of the world provide payments to foreign officials in exchange for business favors. While it may be a common feature of business in these places, this kind of activity is illegal under the Foreign Corrupt Practices Act (FCPA), which criminalizes various acts of bribery and related accounting fraud. The consequences for failing to comply with the FCPA are severe, and ensuring compliance can be especially difficult for start-up or relatively young companies growing rapidly and expanding into foreign markets before they can institute robust compliance systems.
Continue Reading Minding the Compliance Gap in an Evolving FCPA Landscape

The Federal Bar Association’s annual kick-off event – “Views from the Top” – provides the white collar criminal defense bar an invaluable preview of the enforcement priorities of the Department of Justice, the U.S. Attorney’s Office for the Northern District of California, and the Securities and Exchange Commission.  Yet one preview that should be of particular interest to local companies stood out – the typically opaque pre-IPO space should expect heightened scrutiny by the SEC.
Continue Reading Pre-IPO Companies – SEC 2016 Enforcement Priority