Fintech : Law360 : Legal News & Analysis (2024)

Buchalter Starts Fintech And AI Practice With New Seattle Hire

Buchalter PC announced that it hired the former chief legal officer at mortgage-focused fintech company Sagent as a Seattle-based shareholder and chair of its newly launched fintech and artificial intelligence practice group.

Cahill Gordon Adds Crypto Attys, Launches Delaware Office

Cahill Gordon & Reindel LLP announced Wednesday that it has added three attorneys to its rebranded digital assets and emerging technology practice, including a former Delaware deputy attorney general who will lead its newly launched office in the state.

Ex-FTX Exec Seeks Leniency, Saying He Was Kept In The Dark

A former top FTX official has asked a Manhattan federal judge for a lenient 18-month sentence, saying he was not part of company co-founder Sam Bankman-Fried's inner circle and was as shocked as everyone else to learn that the crypto exchange was operating a fraud that siphoned billions in customer funds.

AI Job Recruiter Joonko Blames CEO Fraud For Ch. 11 Filing

AI-powered employee recruitment venture Joonko Diversity Inc. has filed for Chapter 11 protection in a Delaware bankruptcy court, saying its business had rested almost entirely on fraudulent claims made by its ex-CEO.

Senators Release 'Road Map' For Crafting Federal AI Policy

A bipartisan group of senators on Wednesday laid out a "road map" for artificial intelligence policy that calls for increased AI innovation funding, testing of potential harms posed by AI and consideration of the technology's workforce implications.

Swiss Seek Feedback On Crypto Information Exchange

Switzerland's executive body, the Federal Council, is seeking feedback from the public on its plan to adopt two Organization for Economic Cooperation and Development standards that will update the country's automatic exchanges of information to account for crypto-assets, it said Wednesday.

In Hot Seat, FDIC's Gruenberg Pledges 'Fundamental Change'

Federal Deposit Insurance Corp. Chairman Martin Gruenberg will tell House lawmakers Wednesday that he is taking "full responsibility" for his agency's workplace misconduct scandal and eyeing "fundamental" structural reforms, striking a humbled but determined tone as he faces the first of two hearings that could be make-or-break for his job.

FINRA Official Calls Off-Channel Flags 'Shockingly Common'

A Financial Industry Regulatory Authority official said Tuesday that firms often veer into issues with off-channel business communications thanks to what's on their representatives' business cards and email signatures, and that the biggest red flag of recordkeeping violations are the habits of firms' own leaders and managers.

5th Circ. Expresses Doubt On Nasdaq Board Diversity Rules

Lawyers for the U.S. Securities and Exchange Commission and Nasdaq Stock Market LLC faced a barrage of questions from the full Fifth Circuit on Tuesday, with judges wondering whether rules requiring corporations to disclose board diversity information would open the door to investor questions on religious practices, political beliefs or Taylor Swift fandom.

USPTO Guidance On AI And Patents Draws Worry And Praise

U.S. Patent and Trademark Office guidance on when inventions developed using artificial intelligence can be patented has generated concern from some companies and industry groups about discouraging AI adoption and putting patents at risk, while others welcomed it as a sound approach.

Congressional IP Attorneys Keeping Close Watch On AI

Top intellectual property attorneys from the U.S. Senate and U.S. House of Representatives told a room full of Federal Circuit practitioners on Tuesday that artificial intelligence is the biggest thing to watch within IP law over the next few years.

Workday's Liability Defense In AI Bias Battle Troubles Judge

A California federal judge handling a job candidate's discrimination case over Workday's artificial intelligence-powered hiring tools seemed ready Tuesdayto let thelegal battle move ahead, as she expressed skepticism about the software developer's assertion that federal employment laws can't reach it.

Sullivan & Cromwell LLP wants a Florida federal court to dismiss a proposed class action allegingthe firm knew about and helped facilitate the massive fraud by FTX, saying customers of the cryptocurrency exchange platform fail to claim anything beyond a "series of speculative allegations with no factual basis."

Bank Lobbies Rattle Sabers At Fed Over Debit Swipe Fees

Some of the same banking industry groups that sued over the Consumer Financial Protection Bureau's credit card late fee rule have urged the Federal Reserve to refrain from lowering a separate cap on debit card swipe fees, signaling it could be the next bank fee regulation to face a legal challenge if finalized.

Banking Groups Oppose FDIC Position On Interstate Lending

Two banking associations have argued the Federal Deposit Insurance Corp. is trying to create a new regulation through its support of a Colorado state law aimed at reining in high-cost lending by claiming for the first time, in an amicus brief, that interstate loans are made in both the lender's and borrower's states.

CFTC Hits Crypto Firm With First-Ever Registration Claims

A Seychelles-incorporated entity has agreed to pay nearly $1.8 million in penalties and disgorgement to end U.S. Commodity Futures Trading Commission allegations it failed to register as a futures commission merchant in what the CFTC described Monday as a first-of-its-kind action involving digital asset exchanges.

Sens. Slam DOJ's Money Transmitting Biz Interpretation

A pair of U.S. senators say they have "significant concerns" about how the U.S. Department of Justice is interpreting the definition of "money transmission" in two recent criminal actions over crypto mixers, warning that such an interpretation "threatens to criminalize core elements of Bitcoin and other crypto networks."

Kabbage Inks 2 FCA Deals With Feds Totaling $120M

Bankrupt online lender Kabbage Inc. has agreed to pay $120 million in two separate deals to resolve allegations it submitted thousands of false claims for loan forgiveness and operated without adequate fraud controls in place, the U.S. Department of Justice announced Monday.

SEC Tells 3rd Circ. Coinbase Can't Force Crypto Rulemaking

The U.S. Securities and Exchange Commission has told the Third Circuit that it already "reasonably explained" why it denied Coinbase's petition for crypto rulemaking and that it shouldn't have to retool its policy priorities just because crypto firms find it challenging to comply with existing laws.

Crypto exchange Binance said Monday that the federal government has selected a Sullivan & Cromwell LLP partner and a Forensic Risk Alliance founding partner to serve as independent third-party monitors overseeing its compliance with the terms of its $4.3 billion settlement and guilty plea over money laundering, bank fraud and sanctions violations.

White House Bars Real Estate Deal Near Air Force Base

President Joe Biden is ordering a recent purchaser of real estate near an Air Force base inWyoming to sell portions of the property, based on a public tip and a finding from the Committee on Foreign Investment in the United States that cryptocurrency mining there presents a national security risk.

FinTech Atty Moves From R3 To BakerHostetler In SF

BakerHostetler has added to its San Francisco office a former counsel and head of government relations at digital finance company R3, bolstering its business practice, its blockchain technologies and digital assets team and its financial services team, the firm announced Monday.

Skadden Guides Squarespace On $6.9B Go-Private Deal

Squarespace Inc. said Monday it has agreed to a $6.9 billion buyout by private equity firm Permira, withSkadden Arps Slate Meagher & Flom LLP serving as lead counsel to the website building company and at least six additional firms guiding the various parties.

Reddit Accused Of Charging Advertisers For Fake Clicks

An artificial intelligence trading platform hit Reddit with a proposed class action on behalf of advertisers alleging that it has been charged for fraudulent "clicks" while promoting its business on the social media company's website, according to the suit filed in California federal court.

SEC Opposes Quick Appeal Of 'Crystal Clear' Coinbase Order

The U.S. Securities and Exchange Commission onFriday urged a Manhattan federal court toreject Coinbase's bid for a Second Circuit review ofan order allowing an agency enforcement action to proceed, saying the company's cries of uncertainty over how securities laws apply to crypto assets ignore the "crystal-clear" order it is trying to contest.