Who makes the decisions regarding your health care? Your doctor? Maybe not. And that is a growing problem. Today, though patients may not realize it, private equity’s footprint can be found most everywhere health care is provided: emergency rooms, hospital chains, general practitioners’ offices, cardiologists’ offices, home health agencies, nursing homes and more recently, even in behavioral health. Private equity firms have invested almost $1 trillion in hospitals and specialized practices over the last decade and there is no end to this surge in sight. The consequences of this seismic shift upon patient care and costs to the government payers are increasingly drawing scrutiny from industry observers.

The potential for private equity to insidiously undermine the doctor-patient relationship and usurp the ability to make treatment decisions from physicians is growing exponentially. It is vitally important to have in place effective enforcement strategies to ensure that physician autonomy and quality patient care are not sacrificed in a private equity firm’s desire to generate maximum investment returns.

In this article, Jeanne Markey and Gary Azorsky look at how the long under-utilized “corporate practice of medicine” or “CPOM” statutes, combined with false claims statutes, themselves a fixture of our nation’s jurisprudence, can offer a powerful means of preserving a fundamental component of appropriate patient care, the duty and the power of physicians to exercise their independent judgment when caring for their patients.

Read Overlooked Law States Can Use to Get Private Equity Out of Health Care Decisions.

By Daniel McCuaig

The Federal Trade Commission recently failed to stop Meta’s acquisition of virtual reality company Within, while the Department of Justice is now attempting to mitigate Google’s monopolization of the online “ad tech stack” by unwinding its 2008 purchase of DoubleClick. Daniel McCuaig outlines the parallels between the two cases and argues that consumers are threatened with anticompetitive harm if the courts continue to side with tech monopolist defendants when faced with uncertainty.

A technology behemoth shells out hundreds of millions of dollars to purchase the most successful innovator in a nascent market adjacent to one dominated by the behemoth. The direct competition between the two is insignificant and the government agency evaluating the merger lacks a sufficiently clear crystal ball to state with grounded confidence that the combination will lead to anticompetitive effects down the line.

That was the fundamental story in 2008 when Google acquired DoubleClick and it is the fundamental story today as Meta acquires Within.

The Agency’s Options

The agency can either (1) attempt to block the acquisition notwithstanding its imperfect information or (2) allow the deal to close and, if anticompetitive effects manifest, sue to unwind the merger years later.

Neither option is ideal, as evidenced by the FTC’s recent failure to block Meta’s acquisition of Within (option 1) and by the headwinds the DOJ faces in its ongoing case against Google for illegal monopolization of the “ad tech stack” in which the key remedy sought is the unwinding of Google’s 2008 acquisition of DoubleClick (option 2). The Google/DoubleClick story has had fifteen years to develop since the FTC decided not to challenge that merger and it’s the clarity that has come with the passage of time that has convinced the DOJ now to seek a do-over.

“Impermissibly Speculative”

The Northern District of California’s decision to deny the FTC’s motion to preliminarily enjoin Meta’s acquisition of Within throws into starker relief the need for the government realistically to be able to unwind mergers. Application of an unrealistically high standard to enjoin mergers, such as in FTC v. Meta, otherwise will leave consumers to suffer anticompetitive effects in a world where vertical tech mergers are nigh impossible to block prospectively because the harms they threaten are “impermissibly speculative,” but then, when those “impermissibly speculative” harms in fact materialize, courts are unwilling to “unscramble the omelet” of a long-consummated merger.

In FTC v. Meta, the FTC sought “to block the merger between a virtual reality (“VR”) device provider [Meta] and a VR software developer [Within].” Within’s Supernatural is indisputably the leading VR dedicated fitness app in the United States, with “an 82.4% share of market revenue.” Meta also is a VR software provider—one that spends “several billion dollars each year on its VR Reality Labs division” —but it has not yet been able to develop its own successful VR dedicated fitness app in a market that “both parties seem to agree . . . is [] nascent and emerging.” Because the FTC challenged this acquisition on horizontal theories of harm rather than vertical ones, the central question for the court to address was whether Meta would have enhanced competition in the VR dedicated fitness app market absent its merger with Within.

Meta could have induced greater competition, either by developing its own successful entrant(s) or by spurring greater efforts from the players in that market just by the threat of doing so. At the same time, the court expressly recognized: (1) the inherently vertical “‘flywheel’ effect”—a phrase the DOJ uses four times in its ad tech stack complaint—that develops when widespread adoption of a platform incentivizes the creation of content for that platform which, in turn, drives even broader adoption of the platform, and so on; and (2) that “Meta repeatedly stated that VR dedicated fitness apps constituted a distinct market opportunity within the VR ecosystem due to their unique uses, distinct customers, and distinct prices.” That is, the court acknowledged the possibility of the vertical aspects of this merger ultimately leading to the kinds of anticompetitive harm we see in the DOJ’s Google case, but it did not translate that recognition into any kind of weighting in the government’s favor as it evaluated the FTC’s case against Meta.

Read Dan’s complete op-ed on ProMarket.

The Spring 2023 issue of the Shareholder Advocate includes:

Download the Spring 2023 issue (PDF).

In a securities fraud lawsuit straddling the volatile U.S. banking and crypto sectors, Cohen Milstein represents shareholders of Silvergate Capital Corporation, the holding company for Silvergate Bank, a federally registered depository and lender to major cryptocurrency platforms, including FTX.

On February 28, Judge Cathy Ann Bencivengo of the U.S. District Court for the Southern District of California appointed Cohen Milstein co-lead counsel in the case, In re Silvergate Capital Corporation Securities Litigation. Cohen Milstein client Wespath Funds Trust was among the institutional investors collectively appointed lead plaintiff in the same order.

Plaintiffs allege that Silvergate Bank made materially false and misleading statements and omissions about the company’s compliance framework, as well as its anti-money laundering and customer identification programs. Silvergate investors claim they incurred significant losses starting November 7, 2022, when they learned that Silvergate’s compliance practices were lax and had exposed it to potential money laundering and criminal activity.

Then, on January 5, 2023, Silvergate disclosed that the collapse of its client, FTX, had led to a run on Silvergate Bank, causing its deposits to decline by $8.1 billion, or over 68%, over the three months ending in December 2022. This led to an acute liquidity crunch, which forced Silvergate to sell off illiquid securities for a loss of over $700 million and to borrow $4.3 billion in short-term advances from Federal Home Loan Banks.

Originally filed on January 19, 2023, the complaint alleges violations of the Securities Exchange Act of 1934, U.S. Securities and Exchange Commission Rule 10b-5, and other federal statutes. The class period covers those damaged investors who acquired shares of Silvergate Capital Corporation Class A common stock between November 11, 2020 and January 5, 2023 and those who acquired shares traceable to secondary public offerings in January and December 2021.

As a federally regulated banking institution, Silvergate is subject to a wide variety of federal regulations, such as anti-terrorism and anti-money laundering regulation by the Office of Foreign Assets Control and the Financial Crimes Enforcement Network, including the Bank Secrecy Act and the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001.

A critical component of Silvergate’s cryptocurrency business was its one-of-a kind service called the Silvergate Exchange Network (“SEN”). The SEN was the cryptocurrency world’s closest approximation to the SWIFT banking system, which allowed Silvergate customers to send U.S. dollars and euros between eligible counterparty SEN accounts at any time of day using the company’s application.

Throughout the Class Period, Plaintiffs allege that Silvergate repeatedly touted its “strong regulatory compliance program” as a foundation for its growth— including its anti-money laundering policies and Know Your Customer procedures.

The truth began to emerge on November 7, 2022, after the market closed, when Silvergate announced the sudden and unexplained demotion of Chief Risk Officer Tyler Pearson, who is the son-in-law of CEO Alan J. Lane. Social media commenters noted Silvergate’s exposure to FTX and Alameda Research LLC and questioned whether Pearson’s demotion indicated a lack of adequate oversight of Silvergate’s regulatory compliance. In response to this news, the price of Silvergate stock declined by $11.54 per share, or 22.6%, from a closing price of $50.96 per share on November 7, 2022, to a closing price of $39.42 per share on November 8, 2022, on unusually high trading volume.

Over the following months, additional disclosures regarding the company’s lax compliance practices reached investors, further impacting the price of Silvergate stock. Then, on January 5, 2023, the company disclosed that the collapse of FTX had led to a run on Silvergate Bank and its disastrous liquidity crunch, selloff, and borrowing spree. In response to this news, Silvergate shares plummeted $9.38, or 42.7%, in a single day on unusually high trading volume, from a closing price of $21.95 on January 4 to a closing price of $12.57 on January 5.

The bad news has continued for Silvergate as the year progresses. In February, news emerged that the U.S. Justice Department had opened a criminal fraud investigation into Silvergate over accounts it hosted for FTX and Alameda Research, both founded by Sam Bankman-Fried, who is awaiting trial on a range of federal charges. Silvergate shares again dropped on the news.

On March 1, Silvergate revealed in an SEC filing that it would not be able to file its annual report on time and was “analyzing certain regulatory and other inquiries and investigation” to determine whether it could remain viable. A week later, on March 8, the company announced that it planned to “wind down operations and voluntary liquidate the Bank.” In the statement, Silvergate said liquidation was its best course “[i]n light of recent industry and regulatory developments.”

Cohen Milstein and its co-counsel are in the process of preparing an amended complaint that will allege violations of the Securities Act and Exchange Act against the Silvergate defendants and investment bankers involved in the two secondary public offerings.

By Molly J. Bowen
Securities Litigation 101

Initially, participating in a deposition can seem daunting and fraught with peril. But with the proper preparation and support of counsel, the person being deposed, known as the deponent, can overcome these worries and fulfill this important lead plaintiff duty. This article seeks to demystify the process and provide practical guidance for pension funds and other lead plaintiff entities to follow as they prepare for their first deposition.

Process

Depositions are one of the key tools the parties use to obtain evidence. A deposition is essentially a formal interview conducted under oath and transcribed by a court reporter. The attorney taking the deposition will ask the deponent a series of questions designed to learn new information, gain admissions on key issues, and expose credibility issues. Depositions of corporations, government agencies, and other entities including pension plans are referred to as 30(b)(6) depositions, after the Federal Rule of Civil Procedure that governs the process.

In a securities fraud class action, the defendant may request the lead plaintiff’s deposition. The deposition offers defendants an opportunity to test fitness to serve as the lead plaintiff and represent the class. The defendant will send the lead plaintiff a notice identifying the topics the defendant intends to cover at the deposition. The topics typically fall into two categories: (1) lead plaintiff’s investments and (2) lead plaintiff’s oversight of the litigation. In particular, defendants will explore how the lead plaintiff makes investment decisions, oversight of outside asset managers, any contemporaneous knowledge of the alleged fraud, knowledge of the allegations, diligence in monitoring the litigation, and oversight of outside counsel.

Frequently, defendants’ 30(b)(6) notice will seek testimony that is improper, such as a topic that is irrelevant to the litigation, would be excessively burdensome to testify about, or would reveal attorney-client privileged communications. In those situations, your counsel can lodge objections to the notice, negotiate with defendants, and involve the court if necessary to ensure the potential deposition topics are appropriate.

In responding to the deposition notice, the lead plaintiff will have to designate an individual or individuals to testify on its behalf. Sometimes, a lead plaintiff will designate one person to discuss the fund’s investments in the defendant company and a different person to testify on oversight of the litigation. Importantly, the deponent does not need to have personal knowledge or have been personally involved in the underlying events; the entity can educate an individual on the noticed topics so she can competently testify on its behalf.

Preparation In the weeks preceding the deposition, the lead plaintiff and its designated deponents will need to prepare for the deposition. Counsel will guide the preparation which typically includes reviewing a small collection of documents, such as:

  • The deposition notice and specific topics of testimony;
  • Key case documents, such as the complaint, motion to dismiss decision, class certification opening brief, and any lead plaintiff declaration;
  • Documents that the lead plaintiff produced to defendants;
  • Documents that the lead plaintiff’s asset manager produced to defendants; and
  • Public documents relevant to the litigation, including investment policies, board minutes, or other documentation of the decision to initiate litigation and any news articles or social media statements about the litigation.

It may also be useful for the lead plaintiff designee to review any noteworthy prior court decisions involving the entity, especially any negative rulings regarding the lead plaintiff’s ability to serve as a representative of the class. In addition, if the deponent was not directly involved in the activities likely to be the subject of questions (such as the selection and oversight of outside counsel), they may wish to speak to individuals who were involved in that process or are knowledgeable about it. Finally, the preparation should address anything specific to the case or the lead plaintiff. The lead plaintiff may also wish to coordinate with counsel to practice answering likely questions so they have a sense of the rhythm and a chance to work out some initial nerves. Counsel can also explain why defendants will ask certain questions so you have context to understand defendant’s goals.

The Deposition

At the deposition, the court reporter will swear in the lead plaintiff’s designated deponent and the opposing attorney will ask a series of questions. The lead plaintiff’s attorney can object if they believe a question was improper, but with a few exceptions, the lead plaintiff is required to answer the questions notwithstanding the objection.

To successfully handle the deposition, the keys are to listen carefully to the question that is asked, ask for clarification if you do not understand, leave time for counsel to object, and then answer honestly. While it is useful to bear in mind a question’s likely purpose to avoid stepping into traps, it is not the deponent’s job to try to outwit opposing counsel. Focus on answering the questions and allow your counsel to handle the strategy.

At the end of the defense attorney’s questioning, your counsel can ask you questions. In many depositions, this is unnecessary. But if some testimony was unclear or could be misinterpreted, your counsel may ask you about it to ensure that the record is clear and accurate.

After the deposition, the court reporter will send you the transcript to review. If you believe any testimony has been transcribed incorrectly, you can note the errors to be included with the deposition transcript.

Conclusion

It is critically important to the class that the lead plaintiff participate in the 30(b)(6) deposition and take it seriously, as it is one of a lead plaintiff’s most important responsibilities. Although a deposition may initially seem intimidating or excessively time-consuming, with the appropriate guidance and support from counsel, it can be very manageable.

By Kate Fitzgerald

The government of Rwanda announced on March 24 via The New York Times that Paul Rusesabagina, famed “Hotel Rwanda” human rights activist, political dissident, and winner of the U.S. Presidential Medal of Freedom, had been released from prison after two and a half years. His release came amid U.S. government negotiations and a week after a federal lawsuit brought by his family, whose legal team includes two Cohen Milstein attorneys, was allowed to proceed.

Renowned for his heroic role in sheltering more than 1,200 Tutsis at the luxury hotel he managed in the city of Kigali during the 1994 Rwandan genocide, which became the subject of the movie “Hotel Rwanda,” Rusesabagina, 68, became an outspoken critic of the increasingly autocratic leadership of Rwanda’s President Paul Kagame. His political dissent did not go unnoticed.

As alleged in the family’s U.S. federal complaint, in 2020, Rusesabagina, a Belgian citizen and permanent resident of the United States, was invited to Burundi to speak at churches and with civic leaders about his experiences during the 1994 genocide. He left his home in San Antonio, Texas for a routine trip. While flying to his destination, he was kidnapped. His flight was redirected to Rwanda, where he was arrested and subsequently imprisoned, tortured, and subjected to a sham trial, which resulted in a 25-year prison sentence—essentially, a life sentence, given his age and history of cancer.

As alleged in the family’s U.S. federal complaint, in 2020, Rusesabagina, a Belgian citizen and permanent resident of the United States, was invited to Burundi to speak at churches and with civic leaders about his experiences during the 1994 genocide. He left his home in San Antonio, Texas for a routine trip. While flying to his destination, he was kidnapped. His flight was redirected to Rwanda, where he was arrested and subsequently imprisoned, tortured, and subjected to a sham trial, which resulted in a 25-year prison sentence—essentially, a life sentence, given his age and history of cancer.

The United States was engaged in diplomatic efforts to free Paul Rusesabagina, and formally declared him “wrongfully detained” under the Robert Levinson Hostage Recovery and Hostage-taking Accountability Act.

At the same time, his wife and six children enlisted the services of an international legal team of human rights lawyers, including Agnieszka Fryszman and Nicholas Jacques of Cohen Milstein.

On February 22, 2022, his family filed suit in U.S. District Court for the District of Columbia against the government of Rwanda, President Kagame, and three high-ranking Rwandan officials who planned the kidnapping, alleging the illegal surveillance of the Rusesabagina family, misrepresentation, false imprisonment, and other violations of the federal Electronic Communications Privacy Act, Torture Victim Protection Act (TVPA), and Foreign Sovereign Immunity Act (FSIA).

On March 16, 2023, the Court held that the plaintiffs’ claims could move forward against the three Rwandan officials: Brig. Gen. Joseph Nzabamwita, the Secretary General of Rwandan National Intelligence and Security Services (RNISS); Colonel Jeannot Ruhunga, the head of the Rwandan Investigative Bureau (RIB); and Johnston Busingye, then-Minister of Justice and Attorney General of Rwanda.

One week later, after extensive negotiations with the United States, Rwanda commuted Rusesabagina’s sentence. On March 29, 2023, after two-and-a-half years in captivity, he returned home to his family in the United States.

While nobody outside the Rwandan government can know what tipped the balance in its decision, some observers have given credit to the U.S. litigation, in which the judge had just ruled that defendants could not shield themselves through sovereign immunity.

As detailed by William S. Dodge, U.C. Davis Law professor and member of the Department of State’s Advisory Committee on International Law, in the Transnational Litigation Blog, on March 16,

According to news reports, the United States had been negotiating with Rwanda for months, attempting to secure Rusesabagina’s release. It is telling that the negotiations succeeded just a week after Judge Leon decided that the case could go forward. …the Rusesabagina case shows that human rights litigation can sometimes support rather than hinder U.S. diplomacy. We may never know precisely what finally convinced Rwanda to free Paul Rusesabagina. But the prospect of continuing litigation in U.S. courts and the possibility of ending that litigation must surely have influenced the Rwandan government.

Significantly the District Court found the government officials were not entitled to sovereign immunity and would have to respond to the litigation, including discovery and trial, in the District of Columbia.

The Court agreed with plaintiffs that the two officials from the RNISS and RIB were not entitled to immunity because they were not heads of state, heads of government, or foreign ministers. Nor were they Rwandan diplomats. The Court also determined that the third official, who is presently Rwanda’s High Commissioner to the United Kingdom, although a diplomat, was also not entitled to diplomatic immunity in United States courts given that his function was not affiliated with the United States.

Second, the Court held that the defendants’ conduct of illegally tapping Rusesabagina’s family phones in the United States and fraudulently inducing him to leave the United States on a trip he thought would take him to Burundi met the minimum contacts with the United States criteria to fulfill the Fifth Amendment’s due process clause.

In addition to Cohen Milstein attorneys Fryszman and Jacques, the Rusesabagina family’s legal team included Steve Perles and Edward MacAllister from the Perles Law Firm and Brady Eaves of the Eaves Law Firm.

Cohen Milstein is delighted to have been of service to the Rusesabagina family. We are also appreciative of the industry recognition for our work, including being named to The American Lawyer’s Litigator of the Week—RunnersUp and Shout Outs.

Late last month, the United States Court of Appeals for the Seventh Circuit revived an Employee Retirement Income Security Act of 1974 (“ERISA”) lawsuit by participants in two Northwestern University’s 403(b) retirement savings plans. Following guidance from the Supreme Court’s 2022 Hughes v. Northwestern decision, a three-judge panel reinstated two of the seven original ERISA claims against Northwestern, which administers approximately $5 billion in assets in the two plans. Specifically, the three-judge panel reconsidered three claims by participants regarding breach of fiduciary duties: “that Northwestern (1) failed to monitor and incurred excessive recordkeeping fees, (2) failed to swap out retail shares for cheaper but otherwise identical institutional shares, and (3) retained duplicative funds.” On March 23, the Appeals Court ruled the first two claims could proceed. The revival of these claims could result in more litigation about fiduciary decisions made by retirement plans. The decision will directly affect Taft-Hartley retirement plans, which are subject to ERISA; it also offers reminders of how all pension plan officials should carry out their fiduciary duties to participants.

As background, in August 2016, participants filed suit against Northwestern’s two retirement plans alleging seven different ERISA violations, including violations of duty of prudence, ERISA-prohibited transactions, and Northwestern officers’ failure to monitor fiduciaries. Among the seven claims, two are especially worth mentioning given their applicability to all types of pension plans.

First, participants claimed a breach of fiduciary duty by Northwestern because of excessive recordkeeping fees. Participants asserted Northwestern paid four to five times more for recordkeeping fees by using an uncapped revenuesharing arrangement. According to plaintiffs, Northwestern should have reduced its expenses by combining two recordkeepers into one and leveraging its larger size to bargain for fee rebates. Second, participants alleged a breach of fiduciary duty by Northwestern because it failed to monitor the plans’ investments. Here, participants argued the plans held too many funds that resulted in confusion among participants and generated additional expenses. Like the first claim, plaintiff argued Northwestern should have leveraged its size to bargain for replacing retail shares for lower-cost institutional-class shares of the same funds.

In May 2018, a federal district court judge dismissed the case. In March 2020, the Seventh Circuit affirmed the district court’s dismissal. But in January 2022, the Supreme Court unanimously vacated the Seventh Circuit’s decision and remanded the case back to the district court. In a brief six-page opinion, Associate Justice Sonia Sotomayor reaffirmed and applied the Supreme Court’s holding from its 2015 Tibble v. Edison decision. Her opinion held that courts must determine whether participants alleged a violation of the duty of prudence as set out in Tibble. As part of its inquiry, courts must determine whether a plan fell short of its fiduciary duty by failing to routinely monitor investments and recordkeeping costs and remove imprudent investments or recordkeepers within a reasonable time. The Supreme Court also rejected the Seventh Circuit’s reliance on the so-called “categorical rule” where “providing some low-cost options eliminates concerns about other investment options being imprudent.”

Although Hughes v. Northwestern arises from ERISA law that does not directly apply to public pension funds, the most recent Seventh Circuit opinion remains highly instructive for those pension funds because ERISA reflects relevant trust law and the common law that is applicable to all pension plans. As such, ERISA provides guidance for and is a standard for public pension plan conduct. Specifically, the Seventh Circuit’s decision to revive two breach of fiduciary duty claims against Northwestern provides two key takeaways for all retirement plan fiduciaries, regardless of whether they are subject to ERISA.

First, pension funds should establish and follow processes governing their investment plan and carefully document such processes. The Hughes opinion states that “courts must give due regard to the range of reasonable judgments a fiduciary may make based on her experience and expertise.” The language from Hughes is a reminder that pension plan fiduciaries should create and adhere to procedures when evaluating investment options and recordkeepers. Furthermore, such processes should be well-documented. It’s important to remember that a duty of prudence requires fiduciaries to follow a standard of conduct, not outcome. In other words, the courts will not judge pension plans by the results of their investment decisions, but by the process to reach such decisions.

Second, a pension plan that maintains large numbers of investment options, including low-cost options, could still violate its fiduciary duty. In Hughes, the Supreme Court stated the Seventh Circuit erred by focusing on the fact that Northwestern’s savings plans offered different funds, including low-cost index funds. The Supreme Court then stated that “plan fiduciaries are required to conduct their own independent evaluation to determine which investments may be prudently included in the plan’s menu of options.” The Hughes decision is a reminder that pension plans should routinely review their investment funds and remove poorly performing funds. In the event pension plans elect to keep funds with higher fees, they should again document the process and state the reasons for doing so.

With EY declining to break up its consulting and auditing practice, investors are left to navigate a field of potential landmines in the enormous roster of clients that the Big Four boasts, in an industry that’s perceived as increasingly untrustworthy, says Cohen Milstein’s Laura H. Posner.

Alarm bells are ringing for investor protection advocates following the news that EY is abandoning its plan to split its consulting and auditing businesses, known as Project Everest. The high-profile failure sets a bad precedent for other Big Four firms to take on similar splits, despite the dire need for greater auditor independence in an industry that’s perceived as increasingly untrustworthy.

EY, Deloitte, KPMG, and PwC play an essential role in keeping financial markets intact and providing a bedrock of trust for investors in the prospects of a company. That bedrock has been eroded in recent years, as these firms have grown massive and employ consulting arms that often consult for the very same firms they’re auditing.

This trend has laid bare a mountain of conflicts of interest concerns borne out in recent lawsuits exposing the lengths auditing firms will go to cover up for their consulting clients. Securities lawsuits and regulatory agencies have exposed abject failures to provide effective and honest audits, but given the global reach of the Big Four, they likely are only the tip of the iceberg.

Now that EY has deserted any plans to assuage these concerns through a thoughtful split, it’s created a contentious environment for other firms to pursue well-advised efforts to separate their business lines. Investors are left to navigate a field of potential landmines in the enormous roster of clients that the Big Four boasts, where auditor independence is understandably in question.

Read the complete article on Bloomberg Tax.

In February 2023, the Centers for Disease Control and Prevention released an alarming report revealing that nearly 3 in 5 U.S. teen girls felt persistently sad or hopeless in 2021 —double that of boys, representing a nearly 60% increase and the highest level reported over the past decade.

Takisha Richardson penned a list of 3 things you can do to help a girl exhibiting the signs of sadness, depression or hopelessness.

1. Pay Attention

If you notice drastic changes in your teen’s behavior, approach her gently to find out what’s going on.

2. Be Approachable

Don’t overreact. In lieu of being critical or judgmental, provide a listening ear and help get your teen to the appropriate professionals for help.

3. Avoid Denial

Don’t tell yourself your teen is just going through a phase. Trust your gut and what you know about your teen. At the first sign of change or trouble, delicately approach your teen to try to get insight and help.

Takisha Richardson is a member of Cohen Milstein’s Sexual Abuse, Sex Trafficking, and Domestic Violence team, a former Assistant State Attorney, and Chief of the Special Victims Unit of the State Attorney’s Office for Palm Beach County, Florida.

The Treasury Department has a rare opportunity on its hands. Significant changes to its anti-money-laundering whistleblower program have the potential to cripple money-laundering networks by altering the landscape for financial services professionals. The question is — will it work in practice?

The answer depends on how the Treasury implements these new laws and if the program will provide sufficient incentives to ensure that whistleblowing is both confidential and financially rewarding.

The AML whistleblower program was created in 2020, though the Treasury has not yet issued regulations to specify exactly how the program will work. With amendments added in January, the program’s significant potential to aid law enforcement is far more viable. These new amendments require the government to pay whistleblowers a minimum award and establish a dedicated fund for the payments of those awards. Today, an eligible whistleblower who provides the Treasury or Department of Justice with information that leads to an AML enforcement action and monetary recovery of over $1 million is entitled to an award of at least 10% and up to 30% of the recovered amounts.

A recent history of enforcement actions illustrates the substantial value this updated whistleblower program could produce for both the government and financial professionals who blow the whistle on AML violators.

On Jan. 5, Danske Bank was ordered to forfeit over $2 billion after admitting that it failed to report to the Financial Crimes Enforcement Network that it used U.S. banks to process at least $160 billion of funds obtained at its Estonia location with little to no oversight by AML compliance programs. If a whistleblower had brought this information to the government’s attention through the AML whistleblower program, he or she could have received a minimum award of $200 million.

Coinbase reached a $100 million settlement in January 2023 with the New York State Department of Financial Services for failure to develop a functional compliance program, problems with customer due diligence programs and lack of screening required by Treasury’s Office of Foreign Assets Control. A qualified whistleblower here could have received at least $10 million.

In October 2022, Bittrex, an online crypto exchange platform and a virtual-asset service provider, was assessed a $29 million penalty by Fincen for failure to maintain an effective AML program and to effectively address virtual-asset risks, including failure to monitor anonymity-enhanced cryptocurrencies, transactions from sanctioned jurisdictions subject to OFAC, and exposing U.S. financial systems to darknet markets and ransomware attackers. The minimum whistleblower award in this scenario could have totaled nearly $3 million.

Individuals with information about AML violations are a valuable resource for prosecuting money laundering violations. It’s clear from these and other examples that AML violations are widespread, and whistleblowers can play a role in stopping them in the future, while being rewarded for their actions.

A successful whistleblower program communicates clear rules to whistleblowers to provide financial incentives for coming forward, and provisions to protect the confidentiality of their whistleblowing. The Treasury need look no further for a great example of a modern-day whistleblower program than at its sister federal agency, the Securities and Exchange Commission. Since it was established in 2010, the SEC’s whistleblower program has received tips that have led to over $6.3 billion of recoveries and the payment of over $1.3 billion in awards to over 300 whistleblowers.

The AML amendments importantly provide that a whistleblower who meets all the criteria for an award is entitled to receive at least 10% of the monetary recovery from an enforcement action and can receive up to 30% of that amount. But rules to describe how the award will be determined within that range have yet to be developed. The Treasury should follow the lead of the SEC and issue regulations that list the factors it will consider in determining an award percentage, such as the nature and quality of the information provided, the importance of the action to the agency’s enforcement priorities, and whether the whistleblower facilitated or impeded the agency’s investigation.

The Treasury should also consider making it crystal clear, as the SEC recently did, that it will not use a large monetary recovery as a reason to lower the award percentage that a whistleblower would otherwise receive. This rule is critically important to ensure that whistleblowers who have information regarding the most damaging frauds are fully incentivized to participate in the program.

Read BankThink: Treasury Should Model New AML Whistleblower Rules on SEC’s.