Cornerstone Research’s latest annual report discloses that the number and average size of securities class-action settlements increased in 2015 as compared to 2014.  Total settlement dollars rose to more than $3 billion – similar to the annual average for the prior five years, but a significant increase from 2014.

Cornerstone attributes the 2015 increase in settlements to three consecutive year-over-year increases in case filings. In addition, Cornerstone notes that more of those cases were larger cases, leading to eight “mega” settlements (of $100 million or more) in 2015.

Goodyear_Tire solidFollowing recent trends, the U.S. Securities and Exchange Commission brought an administrative proceeding against a U.S. issuer for the alleged corrupt activities of its foreign subsidiaries. Earlier this week, Goodyear Tire & Rubber Company agreed to pay the SEC over $16 million to settle charges alleging that it violated the accounting provisions of the Foreign Corrupt Practices Act by failing to prevent or detect over $3 million in bribes paid by its Angolan and Kenyan subsidiaries. Goodyear also must report its compliance remediation efforts to the SEC annually for the next three years.

The SEC’s Charges

According to the SEC’s cease and desist order, between 2007 and 2011, Goodyear’s downstream subsidiaries in Kenya and Angola bribed employees of both private and government-owned companies to obtain business. The subsidiaries also bribed police, tax authorities and other local officials, though the SEC’s order did not allege the purposes of those payments. The bribes “were falsely recorded as legitimate business expenses in the books and records of the subsidiaries, which were consolidated into Goodyear’s books and records.”

Shield KeyholeOn February 3, 2015, the SEC’s Office of Compliance Inspections and Examinations (“OCIE”) issued a Risk Alert that summarized its findings about cybersecurity preparedness in the securities industry.  As part of its Cyber Security Examination Initiative, the OCIE collected and analyzed information about cybersecurity practices and trends from over 100