How Toxic Lenders are Responding to SEC Investigations and Enforcement Actions
The United States Securities and Exchange Commission (SEC) has been investigating the convertible toxic note industry for a few years and has recently filed several high profile enforcement actions against several of these “lenders” for violations of certain federal securities laws, particularly failure to register as a “dealer”
A troubling pattern has emerged.
Many of these lenders are probably seeing the writing on the wall as it is only a matter of time before the SEC comes after them. It seems that while panic is slowly setting in, lenders are becoming more and more aggressive in attempting to settle outstanding and unpaid notes and/or claim default and commence lawsuits for the same.