Securities & Financial Analysis

We provide consulting expertise and independent testimony on a wide range of securities litigations, arbitrations and disputes. Our experts have significant econometric and statistical expertise, and clients rely on our experience in evaluating complex disclosures, developing customized event studies and price inflation series. In class actions related to securities, including ERISA, we have extensive experience providing testimony, analyzing class certification issues, quantifying damages, providing critical advice during settlement negotiations, and advising in complex opt-out litigation.

We’ve dealt with court-tested damages methodologies. We handle complex financial instruments and voluminous trade data, including in the high frequency domain to quantify damages (for example, by using our proprietary FTI Consulting Quantum system). Companies, counsel and forensic accountants also seek our assistance with investigations involving insider trading and market timing allegations.

Our clients engage us for assistance on a broad range of disputes, including:

• Market manipulation, such as spoofing
• Competition litigation (e.g., LIBOR, FX, SSAs)
• Other market abuses (e.g., insider dealing, misrepresentation)
• Secured financing (GMRA, GMSLA) transactions
• Investment suitability (e.g., misrepresentations, mismanagement)
• Mergers litigation
• Best execution
• LIBOR transition pre-litigation advisory
• Due diligence (e.g., analyzing due diligence processes, both in M&A settings as well as in a variety of industries, such as the issuance of RMBS and other structured securities)
• Corporate governance claims and compliance matters (e.g., analyzing executive compensation and the practices of board members and committees)

Clients rely on our deep expertise and experience with financial and physical commodity and derivatives across asset classes to deliver comprehensive and objective evidence with impact. By leveraging our valuation, trading, investment management, transactional, risk management and regulatory insights, we’re able to provide sophisticated, rigorous and transparent analysis to support our independent, expert testimony across all major asset classes and products, such as:

• Securities litigations matters (Section 10(b), class certifications, Section 11 and 12 of the Securities Act)
• Early termination of derivatives (ISDA)
• Market abuse, such as future and options spoofing
• Competition litigation (e.g., ISDA fix, CDS) and other market abuses
• Anticompetitive analysis in securities markets
• Investment suitability (e.g., misrepresentations, mismanagement, broker-dealer disputes involving suitability, churning and best execution)
• Structured products (e.g., exotic derivatives, hybrid derivatives)
• Structured finance
• Class actions
• LIBOR transition pre-litigation advisory

Our experts advise courts, tribunals and parties in mediations. In these forums, we provide evidence on complex and critical issues facing the industry.

We’ve been engaged in some of the world’s largest and most visible regulatory, criminal and tax investigations in recent years. Financial institutions, regulatory bodies, competition authorities, and law firms often engage us when they need support to conduct independent investigations in various contexts, such as:

• Competition investigations (e.g., alleged anticompetition behavior involving interest-rate benchmarks, FX, CDS, SSAs)
• Regulatory monitorships
• Market disruption and market abuse (e.g., spoofing)
• Sales practice matters
• High frequency trading
• Rogue or insider trading
• High-profile financial scandals
• Internal disciplinary and compliance investigations
• Fraud investigations (e.g., accounting fraud, misreporting/hidden losses, misvaluation, fraudulent commissions, etc.)
• International tax controversies (e.g., Cum-EX, transfer pricing)

We have the capability to respond rapidly; harvest, reconstruct and host enterprise accounting data; manage and analyze large and varied data sets; conduct interviews; and prepare credible analyses and presentations. Clients rely on our familiarity with the trading environment and prevailing market practice to help them truly understand the rationale for investigated activities. Additionally, because of our industry experience, integrity and investigative independence, our team of experts is often selected to serve in some of the world’s most complex corporate monitor engagements.

With FinTech and automated trading, investigations have become more complex and essentially technology based. As industry experts, we have extensive experience analyzing discretionary and systematic trading patterns and have developed proprietary tools and methodologies to automate the analysis of large datasets. In algorithmic trading, for example, we have experience analyzing and modeling the interaction between the trading strategies and liquidity provision, such as order stacks and matching engines in financial exchanges. We can assess possible causation between the original strategy and market effects, such as dislocation.

Our blockchain and cryptocurrency experts are uniquely positioned to provide valuable insights into various aspects of cryptocurrencies, including anti-money laundering (AML) issues. We draw upon our knowledge of the economics and valuation of digital tokens and their trading patterns, as well as the evolving regulatory environment. The solutions we offer in the context of AML investigations, regulatory probes and private litigations are leveraged and enhanced through our partnerships with top blockchain/cryptocurrency researchers, long experience working with regulators, and our advanced data analytics platform. Our areas of expertise include:

• Economics of blockchain, tokens, smart contracts and dApps
• Token intrinsic valuation, liquidity and decentralization analysis
• Token event studies, market manipulation, loss causation and damages analysis
• Digital asset transaction reviews, monitoring and tracing
• Assessment and development of AML/KYC compliance programs
• Cybersecurity and computer forensics
• Cryptoasset identification and recovery

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