Business Commons^™

State Crypto Regulation: Competing Priorities Shaping Different Outcomes, John T. Bender

Seattle Journal of Technology, Environmental, & Innovation Law

“Cryptomania” is approaching fever pitch. Public officials, practitioners, and investors alike are becoming convinced that what began as a thought experiment has given rise to a full-fledged movement that is here to stay. This movement could potentially transform the modern financial system as we know it.

Today, crypto assets and related platforms are increasingly being adopted to store, secure, and transmit massive amounts of monetary value worldwide. Enforcement agencies like the Securities and Exchange Commission and the Commodity Futures and Trading Commission have ventured into the fray by employing existing legal regimes to regulate in this new frontier. At the …

Fintech And Anti-Money Laundering Regulation: Implementing An International Regulatory Hierarchy Premised On Financial Innovation, Nicholas A Roide

Texas A&M Law Review

Innovations in financial technology (“fintech”) have rippling effects across global markets. Fintech firms utilizing virtual assets and disintermediating blockchain technology continue to rapidly grow in strength and number. As systemic risk mounts due to the inter-jurisdictional nature of fintech, antimony laundering (“AML”) regulators must search for an international answer to maintain global financial stability and protect consumers against illicit activities. A variety of solutions have appeared within local AML regulatory frameworks. These frameworks tend to function as a hierarchy with three ordered objectives: market integrity, rule clarity, and innovation. However, frameworks often place too much emphasis on market integrity and …

How The Subprime Mortgage Crisis Sparked New Legislation And Changed The Way Millennials Purchase Real Estate, Troy T. Kramer

The Journal of Business, Entrepreneurship & the Law

This article will explore the Generation Y's approach to the real estate market and analyze how the Subprime Mortgage Crisis stunted Millennials’ economic development. It also analyzes what ways legislation has changed and government has influenced the economy since 2008 to prevent another free fall of the global economy and to protect consumers from predatory lending practices and under-regulation of the financial sector. Further, this article will analyze how Millennials differ from previous generations in their method of purchasing homes and investing in real estate—with a specific eye towards advances in technology. This article also gives advice to first-time homebuyers …

Chief Loophole Officer Or Chief Legal Officer: Inside Lehman Brothers—A Film Case Study About Corporate And Legal Ethics, Garrick Apollon

St. Mary's Journal on Legal Malpractice & Ethics

This Article discusses the continuing legal education (CLE) visual advocacy documentary-style program, which Garrick Apollon (author of this Article) researched and developed. The case study for this CLE documentary-style program is the film Inside Lehman Brothers—a documentary film by Jennifer Deschamps which chronicles the story of the Lehman whistleblowers. The film presents Mathew Lee, former senior vice president overseeing Lehman’s global balance sheet; Oliver Budde, former in-house counsel (associate general counsel) of the Lehman Brothers; and the racialized female mid-tier manager whistleblowers, who all paid a steep price in the 2008 American subprime mortgage crisis, while many of the …

Peeking Into The House Of Cards: Money Laundering, Luxury Real Estate, And The Necessity Of Data Verification For The Corporate Transparency Act’S Beneficial Ownership Registry, S. Alexandra Bieler

Fordham Journal of Corporate & Financial Law

It is estimated that $800 billion to $2 trillion are laundered globally every year, funding the schemes of bad actors and terrorists alike. These astronomical sums are moved around the world without detection; this is in large part due to the ease with which anonymous shell companies, typically limited liability companies (LLCs), can be created, particularly in the United States. America is one of the most egregious enablers of this practice because most states require little to no information about the person ultimately controlling the entity, known as the “beneficial owner.” Working through an LLC, bad actors often turn to …

Delaware’S Dominance, Wyoming’S Dare: New Challenge, Same Outcome?, Pierluigi Matera

Fordham Journal of Corporate & Financial Law

Despite increasing criticism, Delaware’s dominance in corporate law has not experienced a significant decline: as of today, 67.8 percent of Fortune 500 companies are still incorporated in its jurisdiction. Nevada is known as Delaware’s most important competitor, with an aggressive strategy that has overridden the efforts of any other jurisdiction. Yet, its success has been limited to a specific market segment: small firms with low institutional shareholding and high insider ownership.

Scholars suggest several explanations for both the rise and the staying power of Delaware. These explanations are essentially subsumed under the credible commitment theory and the network theory. According …

Direct Liability And Veil-Piercing: When One Door Closes, Another Opens, King Fung Tsang, Katie Ng

Fordham Journal of Corporate & Financial Law

Piercing the corporate veil has been substantially limited in English law since Prest v. Petrodel. This contraction coincides with the development of the direct liability doctrine which attaches liability directly on the parent company. The authors argue that the shift from using piercing the corporate veil to direct liability is a positive development as it gives English courts a better tool to combat the abuse of separate legal personality. However, compared the English doctrines with their counterparts under the U.S. laws, it is argued that the much broader U.S. piercing doctrine makes the expansion of direct liability doctrine unnecessary in …

Governing Fintech 4.0: Bigtech, Platform Finance, And Sustainable Development, Douglas Arner, Ross Buckley, Kuzi Charamba, Artem Sergeev, Dirk Zetzsche

Fordham Journal of Corporate & Financial Law

Over the past 150 years, finance has evolved into one of the world’s most globalized, digitized, and regulated industries. Digitalization has transformed finance, but also enabled new entrants over the past decade in the form of technology companies, especially FinTechs and BigTechs. As a highly digitalized industry, incumbents and new entrants alike are increasingly pursuing similar approaches and models, focusing on the economies of scope and scale typical of finance and the network effects typical of data. Predictably, this has resulted in the emergence of large digital finance platforms. We argue that the combination of digitalization, new entrants (especially BigTechs), …

The Cryptic Nature Of Crypto Digital Assets Regulations: The Ripple Lawsuit And Why The Industry Needs Regulatory Clarity, Jacqueline Hennelly

Fordham Journal of Corporate & Financial Law

The tension and associated time lag between technology and regulation has been well documented. Paradigmatic of this phenomenon is the global evolution of blockchain technology and digital assets. Digital assets in the blockchain allow users to transact directly without financial intermediaries. However, the regulatory guidelines for the assets, their issuance, and the subsequent transactions are unclear. The Securities and Exchange Commission (SEC) has filed an action to apply its existing regulations and the judicial interpretations to Ripple’s issuance of XRP, its token, and Ripple’s control over subsequent user transactions of XRP. This Note uses SEC v. Ripple as a case …

Esg Ratings: A Blind Spot For U.S. Securities Regulation, Alexander Coley

Northwestern Journal of International Law & Business

Providers of “Environmental, Social, and Governance” (ESG) ratings have emerged as prominent informational intermediaries in the sustainable finance ecosystem. The key players are familiar names such as Moody’s, Morningstar, MSCI and S&P. In recent years, investors, financial markets observers and academics have raised serious doubts about the value and integrity of ESG ratings, pointing to lack of reliability and comparability and risks of conflicts of interest and abuse, including the potential for “greenwashing.”

ESG ratings are now in the crosshairs of financial regulators, particularly, in Europe. However, the regulatory discourse has failed to contend with risks arising from the use …