On Disclosure Controls and Rogue CEOs

Nikola Corp., a supposed maker of hydrogen-powered trucks and other vehicles, will pay $125 million to settle charges with the Securities and Exchange Commission that the company failed to prevent its now-indicted former CEO from making all sorts of baloney statements about the company’s prospects on social media. The SEC announced the settlement on Tuesday,…

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Gensler Gives SPACs the Side Eye

SPACs

SEC chairman Gary Gensler took special purpose acquisition companies to task again this week, devoting an entire speech to the governance and disclosure risks that SPACs pose to investors and arguing that SPACs must be beholden to the same investor protection rules that govern traditional IPOs. Gensler spoke Thursday morning at the 2021 conference of…

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Paper Raises Red Flag on SPACs Governance

SPACs

A new research paper raises disturbing questions about the corporate governance of special purpose acquisition companies (SPACs), and just in time, too — because another, separate bit of research finds that so many SPACs are hitting Wall Street these days that they are single-handedly propping up the number of quarterly filings to the SEC.  Let’s…

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The Second Act of SPACs Enforcement

Last week the Securities and Exchange Commission took its first enforcement action against a special purpose acquisition company (SPAC), in a case involving poor due diligence and misleading disclosures to investors. We should expect more such cases in the future, but there’s also another realm of compliance risk for SPACs that needs more attention.  The…

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Our First SPAC Enforcement Action

SPACs

Well that’s one way to crash and burn: the SEC has charged a SPAC and the space technology company it was trying to acquire with misleading investors about the deal’s proposed risks — including national security questions raised about the space company’s founder — ahead of a proposed merger next month.  The tale is rather…

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SPACs Draw Internal Control, Governance Concerns

SPACs

The Securities & Exchange Commission is stepping up its warnings about special purpose acquisition companies, with a new statement today walking through the internal control and governance concerns that SPACs and the private businesses they acquire are obligated to meet.  SPACs, also known as blank-check companies, are all the rage on the capital markets these…

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SPACs and Corporate Disclosure

SPACs

The Securities and Exchange Commission has published fresh guidance detailing how special-purpose acquisition companies — those corporate contraptions designed to go public first and then acquire other operating businesses later — should disclose conflicts of interest, financial incentives for management, acquisition strategies, and related issues. SEC staff released the guidance on Dec. 22 as a…

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