UK: Broker breached fiduciary duty by not disclosing sum of commission received

The Court of Appeal has held that a credit broker was in a fiduciary relationship with borrowers, with the consequence that the broker reached its fiduciary duty when it failed to inform the borrowers of the size of commission it received from the loan and PPI providers involved. As a result, the credit provider had to account to the borrowers for those commissions.  Continue reading

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UK High Court orders disclosure despite risk of prosecution for criminal contempt under US law

The High Court has ordered a party to litigation to allow the inspection of an attachment to a Deferred Prosecution Agreement entered into with the US Department of Justice in relation to the alleged manipulation of LIBOR rates, where the attachment was confidential and had been placed under seal by a US court: Property Alliance Group Ltd v Royal Bank of Scotland Plc [2015] EWHC 321 (Ch).

The decision is a reminder that neither confidentiality nor the risk of prosecution under foreign law will, necessarily, prevent the court ordering disclosure or inspection of a document in English proceedings. However:

  • The court will take into account the risk of prosecution in considering whether to make such an order. Here the court concluded that the risk was low and it was appropriate to make the order.
  • Where a document is confidential, the court may make case management orders to protect that confidentiality. Here the court made a further special order that, until further order, neither party could refer to the document in open court without permission being obtained in advance.
  • The court may defer its order from taking immediate effect. Here the court set a four-week period in order to give the bank the ability to take any further steps it wished to before the US courts.

Heather Rankin, an associate in our dispute resolution team, considers the decision further below. Read more about this case on Litigation Notes.

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The Serious Crime Act 2015

The Serious Crime Bill received Royal Assent on 3 March 2015 and will now enter into force as the Serious Crime Act 2015 (the “Act”).  It introduces changes in a broad range of areas relating to both financial and non-financial crime. Significantly for regulated firms, it includes the introduction of additional protection from civil liability for those reporting suspicions of money laundering.  It also creates a new offence, of potentially broad scope, of participating in the criminal activities of an organised crime group.  Our briefing explores these two changes in more detail, and outlines the other amendments made by the Act.

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Solvency II and Non-Executive Directors

The PRA and FCA have confirmed their approach to non-executive directors (NEDs) under the Senior Insurance Managers Regime (SIMR).  Some NEDs will have to be pre-approved by the regulator; others, so-called “Standard” NEDs, will not. Continue reading

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US establishes new Venezuela sanctions regime and imposes sanctions on Venezuelan officials

On Monday, 9 March 2015, President Obama signed an executive order declaring a national emergency to deal with the threat to US national security and foreign policy posed by “the Government of Venezuela’s erosion of human rights guarantees, persecution of political opponents, curtailment of press freedoms, use of violence and human rights violations and abuses in response to antigovernment protests, and arbitrary arrest and detention of anti-government protestors, as well as the exacerbating presence of significant public corruption.”  Continue reading

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Filed under Americas, Sanctions and Money Laundering, US

UK: Bank exercising a right of forced sale did not have a duty to obtain the best price reasonably obtainable

The High Court has found that a Bank which had exercised a right of forced sale over an asset was not under a duty by way of an implied term to take reasonable steps to obtain the best price reasonably obtainable. Continue reading

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EU Capital Markets Union proposals

The EU Commission has published for consultation a Green Paper entitled “Building a Capital Markets Union”, which sets out a blueprint for creating a harmonised capital market across the EU by 2019.  Papers published alongside the Green Paper include consultations on a review of the EU Prospectus Directive and on establishing an EU framework for standardised securitisation.  Continue reading

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Corporate Crime Monthly Update February 2015

Welcome to the February 2015 edition of our corporate crime update – our round-up of developments in relation to corruption, money laundering, fraud, sanctions and related matters. Our update now covers a number of jurisdictions. For the full update on each jurisdiction/region, please click on the name of the jurisdiction/region below.  Below we provide a brief overview of what is covered in each update. Continue reading

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Filed under Americas, Asia, Australia, Bribery and Corruption, China, Dubai, EU, Europe, Hong Kong, India, Indonesia, Japan, JURISDICTIONS, Korea, Malaysia, Middle East, Myanmar, Pakistan, Sanctions and Money Laundering, Singapore, Spain, Thailand, UAE, Ukraine, US, Vietnam

Big Four settle disclosure case with SEC

The SEC’s administrative court approved a settlement between the SEC and the Chinese affiliates of PwC, Ernst & Young, KPMG, BDO and Deloitte, fining each $500,000 for not having complied with an SEC disclosure order.  Continue reading

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Filed under Americas, Asia, JURISDICTIONS, US

UK: Insurance Act receives Royal Assent

The Insurance Act has today received royal assent, paving the way for the most significant change to English insurance contract law in over 100 years.  The Act will come into force in August 2016 following an 18-month lead in period.  Continue reading

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