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Business Crimes Bulletin
The Great Pandemic Heist: PPP Loan Fraud
Edward T. Kang
In the COVID-19 era, there has been a heist of great value, but it has not gone undetected. Prosecutors have called the heist the largest fraud in U.S. history, with the thieves stealing hundreds of billions of dollars in taxpayer money through fraudulently obtained Paycheck Protection Program (PPP) loans.
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The Bankruptcy Strategist
Court-Based Student Loan Management Programs Can Facilitate Repayment of Debt Under Chapter 13
Igor Roitburg and Scott F. Waterman
While bankruptcy traditionally has been seen as a challenging pathway for debtors with student loans, court-based student loan management programs have been adopted to facilitate the repayment and resolution of student loan debt within the Chapter 13 bankruptcy process.
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The Bankruptcy Strategist
Private Student Loan Debt and the Exception to Discharge As Viewed Through the Eyes of the Circuit Courts
Gerard S. Catalanello and Kimberly (Kodis) Schiffman
A summary of the factors that courts have considered and will likely continue to consider when addressing dischargeability of private student loans under subsection 523(a)(8)(A)(ii) of the Bankruptcy Code, and a cautionary word for practitioners considering whether to put forth an argument to the contrary.
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Business Crimes Bulletin
Smoke & Mirrors: The New York Cannabis Law’s Illusory Lease Mandate
Marjorie J. Peerce, Michael P. Robotti and Kamera Boyd
New York’s recently enacted cannabis law, the Marijuana Regulation and Taxation of 2021 (MRTA), created a maze of new legal requirements. These provisions affect not only cannabis companies, but also the companies that conduct business with them.
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Accounting And Financial Planning For Law Firms
COVID-19: Economic Stimulus and SBA Loans
Jacob Weichholz, Daniel Mayo and Chris DeMayo
A summary of information on the various provisions under the new federal economic stimulus package.
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Commercial Leasing Law & Strategy
Real Estate Loan Workout: Exchange of Enhancements for Concessions
Richard S. Fries
As a result of the coronavirus pandemic, a property owner might reach out to its lender for urgent, needed debt relief. The lender, which strives for a performing asset, an on-going relationship with its customer makes concessions. In exchange for these concessions, the lender should obtain credit and legal enhancements., which should also enable the lender to make concessions that are more meaningful to the property owner, its investors, its tenants and its business.
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Cybersecurity Law & Strategy
New York’s Cyber Regulation Two Years Later: We’ve Only Just Begun
Craig A. Newman and Kade N. Olsen
The Conclusion of the “Transitional Period” for New York’s Cybersecurity Regulation Marks the Beginning, Rather Than the End, of an Organization’s Compliance Efforts
Financial institutions will have to certify annually that their internal controls and cybersecurity practices remain up to snuff. And now that the transitional periods for implementing the cyber regulation have passed, covered institutions will need to certify that they have complied with each provision.
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Accounting And Financial Planning For Law Firms
Big Law’s Trojan Horse: Are the Big Four Preparing an Invasion?
Dan Packel
Law Firms Partner With the Big Four to Serve Their Clients, But the Accountants Pose an Existential Threat. What Will Happen If — or When — They Turn Competitive?
For law firm leaders, rank-and-file partners and everyone else in the law firm ecosystem, the Big Four shouldn’t be a laughing matter. They are serious about selling legal services, and clients are listening.
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Cybersecurity Law & Strategy
Robbing a Locked Bank Vault from Home: Legal Issues Raised by Cryptocurrency Frauds
Chris Ott
The advent of cryptocurrencies has raised a host of legal issues; some of the most immediate ones — such as whether cryptocurrencies are securities — appear to have been resolved, but cryptocurrency theft remains a major concern for traders and investors given that billions of dollars of cryptocurrency are stolen every year.
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The Bankruptcy Strategist
Which Financial Representations Will Justify a Discharge Objection after Lamar, Archer?
John A. Thomson, Jr.
The Supreme Court’s decision in Lamar, Archer & Cofrin, LLP v. Appling has significantly constricted the range and nature of statements that will support a successful objection by a creditor to the discharge of a debt that was obtained by the statements in question. This constriction could have a very real impact on how entities that loan money or provide services on credit review and collect information regarding a borrower’s creditworthiness.
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Business Crimes Bulletin
Losing the Ability to Conduct Business, Period
William Jacobson and Lauren Muldoon
The Potential Impact of Multilateral Development Bank Sanctions
What could be worse than a several-hundred-million dollar Foreign Corrupt Practices Act fine hitting your company? How about not being allowed to even compete for many of your most important contracts for a period of several years.
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Accounting And Financial Planning For Law Firms
Litigation Funders Face Their Hardest Sell: Big Law
Roy Strom and Ben Hancock
There Is More Money Than Ever In the Hands of Litigation Financiers, But Can They Convince Law Firms to Use It?
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Entertainment Law & Finance
Loan-Out Corporations after Tax Reform and CA Supreme Court Decision in 'Dynamex'
Robert M. Jason
The tax reform bill signed by President Trump at the end of 2017 has caused us to take a fresh look at many long-held assumptions about how to take into account income taxes in planning for the entertainment industry. At the same time, the California Supreme Court recently decided a case that has the potential to eviscerate loan-out corporations entirely. This article discusses loan-out corporations in light of these two important developments.
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Commercial Leasing Law & Strategy
Trump Administration Bars SBA Loans to Cannabis Industry Support Businesses
Steven Schain
The U.S. Small Business Administration updated its standard operating procedures to prohibit providing loans to both marijuana- and hemp-related businesses and businesses deriving any gross revenue from sales to marijuana-related businesses (MRBs) including those providing lighting, hydroponic equipment or testing services.
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The Bankruptcy Strategist
New Bill Would Protect Law Licenses of Student Loan Defaulters
Nineteen states currently allow government agencies to revoke the professional licenses — including law licenses — of student loan defaulters. But that may change.
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Business Crimes Bulletin
When Is a Bid or Offer a ‘Spoof’?
Jodi Misher Peikin and Brent M. Tunis
U.S. Supreme Court Denial of Cert Leaves Statute Vague
This article analyzes the confusion faced by commodity futures traders in assessing whether their trading strategies constitute illegal spoofing and examines whether the CFTC and Seventh Circuit have provided sufficient guidance on the distinction between spoofing and legitimate trading activity.
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Business Crimes Bulletin
Another Virtual Currency Player Charged with Fraud by CFTC
Stephanie Forshee
The enforcement action alleges that Las Vegas-based My Big Coin Pay Inc., a virtual currency wallet and platform, misappropriated more than $6 million from its customers for “personal expenses and the purchase of luxury goods.”
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Accounting And Financial Planning For Law Firms
Online Marketing Practices Continue to Pose Regulatory Threats for the Financial Services Industry
Craig Nazzaro, Brad Rustin and Elizabeth A. DeVos
Last year, the FTC released a staff report on Cross-Device Tracking, which added to the FTC’s efforts to regulate emerging issues in the ever-evolving area of online behavioral advertising. The advertising in question involves the collection of data from a particular computer or device regarding a user’s Internet-viewing behavior over time and across non-affiliate websites. Cross-device tracking is the logical next step for this technology.
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Business Crimes Bulletin
In the Courts
Colleen Snow
Turkish Banker Conspired to Evade U.S. Sanctions
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Accounting And Financial Planning For Law Firms
Taxing Questions for Law Firms Looking to Benefit in the New Regime
Meredith Hobbs
The new law offers two obvious potential benefits: a 20% deduction for pass-through entities such as partnerships, and a 21% tax on corporations.
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Commercial Leasing Law & Strategy
Lender’s Choice In Naming Defendants Is Under Assault
Bruce J. Bergman
Can a foreclosing plaintiff choose whom to name as a party defendant in a foreclosure action? In New York, in the absence of prejudice to the defaulting property owner, the answer is yes. Although a recent holding of New York’s Appellate Division, Second Department, tacitly suggests “no,” the case may not have addressed the actual controlling principles.
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Business Crimes Bulletin
New-Wave Legal Challenges for Bitcoin and Other Cryptocurrencies
Robert J. Anello and Christina Lee
As the adoption of cryptocurrencies spreads throughout the business and financial sectors, so too do the concerns that lack of regulation render the new-age currency susceptible to fraud, manipulation, and to being used as a vehicle for money laundering. Nevertheless, recent efforts by U.S. enforcement agencies to apply and enforce financial regulations mean greater scrutiny than ever before.
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The Bankruptcy Strategist
Reflections on the Life Partners Holding Inc. Bankruptcy
H. Thomas Moran, II
Many bankruptcy practitioners are at least somewhat familiar with the highly publicized proceedings involving Life Partners Holdings Inc. (LPHI), a company that sold fractional ownership interests in life insurance policies — referred to as life settlements. This case was as complex as any could imagine and, as the Trustee appointed to manage this bankruptcy, the author had a front-row seat.
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The Corporate Counselor
Effective Internal Investigations
Terence Healy
A Checklist for In-House Counsel
Every general counsel over the course of his or her career will face the need to conduct an internal investigation into events at the company. Many of these may be routine in nature, such as matters dealing with individual employees or human resources issues. But at times, the company may be required to examine issues affecting the core of its business, with potential serious impact on its financial performance or with regulatory exposure.
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Cybersecurity Law & Strategy
Bitcoin Is Fueling the Ransomware Epidemic
M. Scott Koller
Money is a powerful motivator, but it alone wasn't enough to fuel the ransomware epidemic. After all, the first documented ransomware infection was in 1989, but it remained relatively unknown until its resurgence over the past five years. So what changed? In short, bitcoin.
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Cybersecurity Law & Strategy
Third-Party Cybersecurity Strategies Critical to Preparedness
David F. Katz, Richard D. Smith, Elizabeth K. Hinson, Jason Mark Anderman and Sarah Statz
This article examines the guidelines published by Board of Governors of the Federal Reserve System on managing outsourcing risk, along with the Office of the Comptroller of the Currency (OCC) 2013 OCC Bulletin 2013-29 and the supplemental Jan. 24, 2017, examination procedures, which are designed to help bank examiners tailor the examinations of national banks and federal savings associations determine the scope of the third-party risk management examination.
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Equipment Leasing Newsletter
Serving Two Masters: When 'Bankruptcy-Remote' Meets Public Policy
Pamela J. Martinson
Structured financing transactions make extensive use of entities formed for the specific purpose of reducing the likelihood that assets will be involved in a potential bankruptcy proceeding. Known as "bankruptcy-remote entities," or "BREs," these entities are subject to structures and covenants in financing documents and their own formation documents, which are designed to reduce the likelihood that the BRE will file for bankruptcy protection.
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The Matrimonial Strategist
Forensic Accounting: When Do You Need It?
Ken Stalcup, Penny Lutocka and Ross Koble
Most matrimonial attorneys have heard a client, typically the "out-spouse" in a marriage with a business interest, say, "The books are cooked," or "Personal expenses are being paid by the business," or "The accounting records are fiction." Failing to probe these issues may cost your client a lot of money when the asset division takes place, and may leave him or her dissatisfied with your representation.
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New York Real Estate Law Reporter
Bank Liability for Federal Housing Act Violations
Stewart E. Sterk
A discussion of a case in which the United States Supreme Court faced a claim by the City of Miami that two banks had violated the federal Fair Housing Act by issuing loans to black and Latino customers on terms less favorable than loans issued to similarly situated customers who were white and non-Latino.
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Equipment Leasing Newsletter
Using a True Lease or a TRAC Lease
Deirdre M. Richards
Potential Complications in Bankruptcy
An equipment financing company will often decide whether it wants a transaction to be a true lease or a TRAC lease as opposed to a retail sale. A good reason to be able to make the distinction is to determine what might be the best structure for an equipment financier. This article explores the differences.
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Equipment Leasing Newsletter
Sixth Circuit Trims Banks' Good-Faith Defense to Fraudulent Transfer Claims
Michael L. Cook
Part Two of a Two-Part Article
Last month, we began our discussion of what constitutes a good-faith defense to a fraudulent transfer claim with an initial examination of the recent Sixth Circuit opinion in Meoli v. Huntington Nat'l Bank. We continue the analysis this month by focusing on sub-issues presented in Meoli, and, we discuss a recent Ninth Circuit preference decision that offers a mistaken analysis of the transfer issue.
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Equipment Leasing Newsletter
Sixth Circuit Trims Bank's Good-Faith Defense to Fraudulent Transfer Claims
Michael L. Cook
Part One of a Two-Part Article
The issue of what constitutes a good-faith defense to a fraudulent transfer claim is a murky question that has produced a wide variety of reported decisions from appellate courts over the years. But a recent Sixth Circuit opinion sheds some clear light on a complicated fact pattern.
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Accounting And Financial Planning For Law Firms
SEC Takes Aim at Political Contributions By Investment Advisers
Joseph F. Savage, Jr. and Stephanie M. Aronzon
While it remains unclear both when the regulators will invoke their authority to enforce the nearly limitless strict liability provision of the "pay-to-play" rules and how they will determine the appropriate remedy, the recent settlements and the SEC's handling of exemptive relief petitions may provide some clues.
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