Securities Fraud in the Age of COVID-19: Now is Not the Time to Relax Compliance Programs or Internal Controls
The SEC has halted trading on the stock of at least four publicly traded companies based on allegedly false COVID-19 claims and/or suspicious trading, and issued a number of warnings to investors regarding potential market misconduct, including insider trading, market manipulation, and Ponzi/pump-and-dump schemes.
Chiesa Shahinian & Giantomasi advises that “now is not the time for companies or investment firms to relax or cut back on their corporate internal controls or compliance programs. If anything, given the likelihood of increased scrutiny by regulators and plaintiff’s lawyers, greater oversight and monitoring is needed to mitigate the current risks of fraud.”
