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The Latest Alleged Wells Fargo Scandal – Imposing Unnecessary Auto Insurance on 800,000 Unsuspecting Customers

On July 30, 2017, Wells Fargo & Co. customers filed a putative class action lawsuit alleging the bank forced them to pay for unnecessary auto insurance, which resulted in some members of the purported class having their vehicles repossessed. The lawsuit, Hancock v. Wells Fargo & Co., et al., 17-cv-04324, U.S. District Court, Northern District … Continue Reading

SEC Disgorgement Constitutes a Penalty – How Far Will the Argument Go?

On June 5, 2017, Justice Sotomayor delivered the unanimous opinion in Kokesh v. SEC, 2017 U.S. LEXIS 3557 (June 5, 2017), holding that disgorgement collected by the Securities and Exchange Commission (SEC) constitutes a “penalty” under 28 U.S.C. §2462,[1] and thus subject to a five-year statute of limitations. In a relatively short, but thorough opinion, … Continue Reading

UK Conservative Party Pledges to Abolish Serious Fraud Office if Re-elected on 8 June 2017

In my C-Suite Risk Report posting in March, I discussed the UK’s Serious Fraud Office’s (SFO) investigation into Rolls-Royce (RR) and the UK Court’s approval of a Deferred Prosecution Agreement (DPA). As a result of that DPA, RR avoided prosecution, but paid £671m (approximately US $800m) to UK, US and Brazilian authorities in order to … Continue Reading

Insurers’ Antitrust Exemption in Crosshairs Again as Part of Potential Health Care Overhaul

Just when you thought the health insurance legal and regulatory landscape couldn’t get any more interesting, along comes the Competitive Health Insurance Reform Act of 2017 (the Act). The Act removes a longstanding antitrust exemption and places health insurers back under federal antitrust scrutiny. The House recently passed the Act overwhelmingly (416 – 7), and … Continue Reading

Rolls-Royce Plc Motors Away from Prosecution by Paying Authorities £671m in Connection with Bribery and Corruption Offences

After a four year investigation by the UK’s Serious Fraud Office (“SFO”) into car and engine manufacturer Rolls-Royce, a UK Court approved a Deferred Prosecution Agreement (“DPA”) in January 2017.[1]  The investigation focused on bribes Rolls-Royce paid to secure valuable export contracts in various markets, including China, Brazil and Indonesia.  Although the DPA allows Rolls-Royce … Continue Reading

Employers Beware: The Ninth Circuit Finds That Liability Waivers in Consumer Report Disclosures “Willfully” Violate the FCRA

On January 20, 2017, the Ninth Circuit Court of Appeals issued an opinion with far-reaching consequences for employers’ liability under the Fair Credit Reporting Act (15 U.S.C. § 1681b(b)(2)(A)), and which could impact insurance coverage for such liability. In Syed v. M-I, LLC, et al., 2017 WL 242559 (9th Cir. Jan. 20, 2017), the court … Continue Reading

Every Rose Has Its Thorn: No D&O Coverage For Bad Loans To Flower Company, Fifth Circuit Says

In a recent decision, the Fifth Circuit ruled in favor of Markel American Insurance Company in a D&O liability coverage dispute centering on the application of the policy’s “Creditor Exclusion.” The panel affirmed a lower court’s holding that the exclusion precluded coverage for claims brought by lenders of the insured. Markel Am. Ins. Co. v. … Continue Reading

Crime Policy Does Not Cover Loss of Company Funds Resulting From Social Engineering Scheme

In a long-awaited decision (at least by the parties and fidelity law practitioners) the Fifth Circuit Court of Appeals has held that a “Computer Fraud” Insuring Agreement in a Crime Insurance Policy does not cover the insured’s loss after its employees were tricked into wiring approximately $7 million to a fraudulent bank account set up … Continue Reading
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