Government Enforcers Focused On Coronavirus-related Actions

Key Points:

• Market participants should review and assess their compliance procedures to prevent and detect insider trading risks associated with COVID-19.
• Companies should increase their vigilance regarding cybersecurity threats such as phishing emails and malicious websites relating to coronavirus.
• Investors should be wary of potential stock manipulation schemes related to fake COVID-19 claims.

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Enforcers across the federal government are focused on fraud risks related to the COVID-19 pandemic and resulting market turmoil. Below is a summary of recent public statements and enforcement actions by regulatory and criminal authorities arising out of the COVID-19 pandemic. Investment advisers, broker-dealers and other regulated entities, as well as public companies, should be mindful of these rapidly emerging trends to protect themselves from fraudulent activity by others and to reduce the risk of misconduct within their own organizations.