We have reported previously on the proposed overhaul of the European Financial Regulatory System (click here to see our previous post). On 17 November 2010, the Council of the European Union formally adopted the legal texts to establish the European Systemic Risk Board (ESRB) and three European Supervisory Authorities (ESAs): a European Banking Authority (EBA), a European Insurance and Occupations Pensions Authority (EIOPA) and a European Securities and Markets Authority (ESMA). 

In a verdict handed down on Thursday (11/18/10) ,a South Florida federal jury found that BankAtlantic violated federal securities laws by making several false statements to investors during the class period.  These false statements included seven statements made by bank executives during investor conference calls. 

The U.S. District Court in Manhattan recently dismissed a securities class action brought by a proposed class of investors, alleging that the company and two of its senior officers violated Section 10(b) of the Securities Exchange Act of 1934 (“Exchange Act”) and SEC Rule 10b-5 by making false or materially misleading disclosures about the company’s risk management and exposure to mortgage-related securities. 

On 22 September 2010, the European Parliament approved a sweeping overhaul of financial supervision in Europe, including the creation of a new supervisory authority for insurance and reinsurance – the European Insurance and Occupational Pensions Authority (EIOPA) – and a European Systemic Risk Board (ESRB) which will monitor threats to the EU economy as a whole. 

HM Treasury has issued a consultation paper on proposals for a special administration regime for investment banks which it hopes will lead to less disruption in financial markets and simplify the process of returning assets and money to clients and creditors of a failing bank. 

It is reported in the press that the PWC administrators of Lehman Brothers International (Europe) Limited (LBIE), the London-based arm of the Lehman bank, are to appeal the recent Court of Appeal ruling relating to the distribution of segregated client funds. The first instance judge held that those clients of LBIE whose funds should have been segregated, but were not, were not entitled to share in the pot of client money.