No. 431: Executive Compensation in the Insurance Industry—Data for 2020 from 2021 Filings with Nebraska

Background

In No. 428 (July 7, 2021), I reminded readers that I started publishing insurance industry executive compensation data in 1975 in The Insurance Forum, my monthly newsletter. I continued doing so on my blog after ending the Forum in December 2013. My three sources of data have been the Securities and Exchange Commission (SEC), the Nebraska Department of Insurance (NDI), and the New York State Department of Financial Services (NYDFS). In No. 428, I showed data for 2020 from 2021 filings with the SEC. Here I show data for 2020 from 2021 filings with the NDI. I plan to show data for 2020 from the NYDFS later.

NDI Data

In the tabulation below, I show NDI data for individuals who received at least $5 million in 2020. Where two or more individuals in a company are shown, they are listed in descending order of compensation.

NDI data are in a "Supplemental Compensation Exhibit" (Exhibit) filed by each insurance company doing business in Nebraska. Each Exhibit normally shows figures for the top ten company officials. The figure I show for each individual is the "Total." The seven components of the "Total" are "Salary," "Bonus," "Stock Awards," "Option Awards," "Sign-on Payments," "Severance Payments," and "All Other Compensation." NDI provides all the Exhibits on a CD to any member of the public for $80.

The Allocation Problem

Where companies are members of a Holding Company Group ("Group"), many companies show the total amount received by each individual from all companies in the Group. Some companies, however, allocate each individual's compensation to each company in the Group.

For companies that allocate, it is extremely difficult to locate all companies doing business in Nebraska that are part of a Group. For that reason, as I did last year, I have modified the tabulation below from years prior to 2020 by not trying to assemble the Group data. Instead, with one exception noted below, I show figures for the company with the largest dollar amounts for each Group. Because of the modification, the compensation figure shown for many individuals is smaller, and often much smaller, than the individual's total compensation from all members of the Group. Also, because of the modification, some companies probably are not listed because no individual had at least $5 million of compensation from a single company in the Group.

The Liberty Mutual Group Exception

The Liberty Mutual Group is a special case. Unlike any other company, the Exhibit for Liberty Mutual Insurance Company makes clear that the total compensation paid to each executive from all members of the Group is exactly twice the figure shown in the Exhibit. I have therefore shown in the tabulation below the larger figure for each executive listed.

NDI Data for 2020
Accident Fund General Ins Co
Elizabeth Haar	$8,684,745
Ace Fire Underwriters Ins Co
John J Lupica	6,630,000
Paul J Krump	5,650,000
Acuity A Mutual Ins Co
Benjamin M Salzmann	17,998,084
Aetna Life Ins Co
Karen S Lynch	10,730,916
Alec R Cunningham	5,465,563
Affiliated FM Ins Co
Thomas A Lawson	5,564,595
AIG Assurance Co
Alexander Ross Baugh	5,954,901
Allstate Ins Co
Thomas J Wilson	18,009,544
Dogan Civgin	5,873,381
Terrence Williams	5,699,432
Glenn T Shapiro	5,032,673
Ambac Assurance Corp
Claude LeBlanc	6,022,820
American Family Ins Co
Jack C Salzwedel	12,359,016
William B Westrate	6,217,990
American Family Life Assur (AFLAC)
Daniel P Amos	14,367,561
American General Life Ins Co
Kevin Hogan	5,111,283
American National Ins Co
James E Pozzi	6,028,583
American Pet Ins Co
Tim Graff	5,013,734
American United Life Ins Co
James S Davison	6,019,250
AmGUARD Ins Co
Sy Foguel	5,322,285
Assured Guaranty Corp
Dominic Frederico	11,963,691
Auto-Owners Ins Co
Carolyn B Muller	6,065,377
Brighthouse Life Ins Co
Eric T Steigerwalt	8,890,177
Chicago Title Ins Co
Raymond Randall Quirk	18,168,514
Michael Joseph Nolan	5,597,464
Cincinnati Ins Co
Steven J Johnston	5,765,855
Continental Casualty Co
Dino Robusto	7,951,499
Contractors Bonding & Ins Co
Jonathan E Michael	7,114,515
Crum & Forster Indemnity Co
Marc James Adee	6,191,370
Employers Assurance Co
Douglas Dean Dirks	5,624,736
Equitable Financial Life Ins Co
Mark Pearson	6,958,432
Essent Guaranty Inc
Mark Casale	7,570,910
Everest Reinsurance Co
Mark Kociancic	5,292,109
Juan C Andrade	5,223,820
Farmers Ins Exchange
Jeffrey J Dailey	7,084,202
Fidelity & Guaranty Life Ins Co
Christopher O Blunt	8,082,752
First American Title Ins Co
Dennis Gilmore	11,020,220
Kenneth DeGiorgio	7,766,153
George Livermore	6,432,197
Mark Seaton	5,392,110
Christopher Leavell	5,094,983
GEICO Indemnity Co
Olza Minor Nicely	77,879,001
William Evan Roberts	14,169,158
Todd Anthony Combs	9,730,769
Genworth Financial Group
Kevin Douglas Schneider	7,724,612
Thomas McInerney	7,317,588
Daniel Joseph Sheehan IV	7,126,812
Globe Life & Accident Ins Co
Frank M Svoboda	7,807,475
William M Pressley	6,746,829
Great American Ins Co
Carl H Lindner III	10,346,831
Great-West Life & Annuity Ins Co
Edmund F Murphy	6,811,265
Guardian Life Ins Co of America
Deanna Mulligan	10,300,764
Eric Dinallo	5,517,427
Hanover Ins Co
John Roche	5,467,660
Hartford Fire Ins Co
Christopher Swift	5,560,332
Douglas G Elliot	5,286,046
Health Care Service Corp
David Lesar	16,967,386
Paula Steiner	12,647,352
Milton Carroll	8,918,153
Blair Todt	6,361,493
Maurice Smith	5,904,535
Danny McCoy	5,079,145
Horace Mann Ins Co
Marita Zuraitis	5,853,495
Humana Ins Co
Bruce D Broussard	23,173,229
Brian A Kane	18,738,969
Christopher Howal Hunter	6,157,542
T Alan Wheatley	6,072,881
William K Fleming	5,499,625
Insurance Co of the West
Kevin Prior	18,068,044
ISMIE Mutual Ins Co
Alexander R Lerner	5,119,812
John Hancock Life Ins Co (USA)
Daniel Janis III	6,692,374
Emory Sanders Jr	6,386,545
Christopher Conkey	5,242,891
Liberty Mutual Group
David H Long	23,180,342
Dennis J Langwell	13,030,176
Timothy Sweeney	11,347,194
Christopher L Peirce	8,715,066
Neeti Bhalla Johnson	8,242,320
James F Kelleher	7,423,518
James M McGlennon	6,780,962
LifeSecure Ins Co
Ken Dallafior	5,885,498
Lincoln Life Assur Co of Boston
Dennis R Glass	20,090,544
Randal J Freitag	5,878,201
Wilford H Fuller	5,753,626
Massachusetts Mutual Life Ins Co
Roger Crandall	16,916,485
Michael Fanning	6,397,603
Elizabeth Chicares	5,314,695
Melvin Corbett	5,069,947
Metropolitan Group
Michel Khalaf	7,624,215
Steven J Goulart	6,338,392
Midland National Life Ins Co
Esfandyar E Dinshaw	6,186,835
Minnesota Life Ins Co
Christopher M Hilger	6,479,342
Mortgage Guaranty Ins Corp
Timothy Mattke	6,686,421
Munich Reinsurance America Inc
Anthony J Kuczinski	5,222,034
National Western Life Ins Co
Ross R Moody	8,191,259
New York Life Ins Co
Theodore A Mathas	24,238,639
Matthew M Grove	10,739,520
Anthony R Malloy	6,265,631
Yie-Hsin Hung	5,340,371
Northwestern Mutual Life Ins Co
John E Schlifske	18,018,703
Ohio National Life Ins Co
Gary Thomas Huffman	16,443,349
Pacific Life Ins Co
James T Morris	8,174,088
Penn Mutual Life Ins Co
Eileen McDonnell	6,276,600
David M O'Malley	5,168,950
Principal Life Ins Co
Karl W Nolin	9,434,249
Daniel J Houston	6,240,643
Kelly D Rush	5,696,725
Protective Life Ins Co
Carl Thigpen	21,716,296
Richard Bielen	6,092,393
Prudential Ins Co of America
Charles Frederick Lowrey	8,332,876
Robert Michael Falzon	6,657,252
Stephen Pelletier	5,641,262
QCC Ins Co
Daniel J Hilferty	9,926,721
Radian Guaranty Inc
Richard A Thornberry	7,723,478
RiverSource Life Ins Co
John R Woerner	7,695,824
Security Benefit Life Ins Co
Michael Patrick Kiley	7,721,877
Selective Ins Co of America
Gregory Murphy	5,690,743
SILAC Ins Co
Stephen C Hilbert	5,839,167
Standard Ins Co
John Gregory Ness	14,187,730
State Farm Group
Michael Leon Tipsord	20,266,506
Paul Joseph Smith	6,812,210
Randall Houston Harbert	6,806,447
Mary Angela Schmidt	6,048,516
Teachers Ins & Annuity Assn
Roger Ferguson	6,127,887
Transatlantic Reinsurance Co
Michael C Sapnar	9,546,207
Kenneth Apfel	5,708,125
Travelers Casualty Co
Alan D Schnitzer	18,184,834
Avrohom J Kess	6,325,135
United States Liability Ins Co
Thomas P Nerney	18,198,604
Voya Retirement Ins & Annuity Co
Rodney Owen Martin Jr	5,975,117
Westcor Land Title Ins Co
Mary O'Donnell	5,326,688
Western & Southern Life Ins Co
John Barrett	11,495,043
Wilton Reassurance Co
Michael Fleitz	22,564,030
Michael Greer	21,792,750
Mark Sarlitto	21,463,100
Chris Stroup	20,524,898
Enrico Treglia	15,068,725
Andrew Wood	14,914,350
Ray Eckert	13,592,822
Perry Braun	7,616,725

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Email: jmbelth@gmail.com

Blog: www.josephmbelth.com

No. 430: Academic Freedom, Tenure, and Nikole Hannah-Jones

The Howard Press Release

On July 5, 2021, Howard University (Washington, DC) issued a press release announcing that Nikole Hannah-Jones, a prominent Black journalist at The New York Times, is joining the Howard faculty. She will be a tenured professor in Howard's Cathy Hughes School of Communications. Hannah-Jones will occupy the newly created Knight Chair in Race and Journalism. In 2020, Hannah-Jones received a Pulitzer Prize for her work in establishing The 1619 Project.

The LDF Press Release

The events that preceded the Hannah-Jones move to Howard provide a powerful lesson in the importance of academic freedom. On July 6, the Leadership Defense Fund (LDF) of The National Association for the Advancement of Colored People issued a press release entitled:

Nikole Hannah-Jones Issues Statement on Decision to Decline Tenure Offer at University of North Carolina-Chapel Hill and to Accept Knight Chair Appointment at Howard University

The LDF web site provided in full a lengthy explanatory statement by Hannah-Jones. That caught the attention of Dan Rather, a well-known former television reporter who is highly regarded by many people (including me). He is now retired and publishes an email newsletter called Steady. On July 9, Dan Rather, Elliot Kirschner, and the Steady team published a piece entitled "In Defense of Freedom—of the Press and the Academy," and published in it the entire Hannah-Jones statement as it appeared on the LDF web site. I strongly recommend you read it in full.

A Personal Experience

The Hannah-Jones story reminded me of a personal experience relating to academic freedom. I joined the Indiana University (IU) faculty in 1962. My research was controversial in life insurance circles, and it generated complaints to IU from prominent alumni in the life insurance business. IU provided me with complete academic freedom, even in the years before I was granted tenure.

IU strongly protects the academic freedom of its faculty. A vivid example was the furor over Professor Alfred Kinsey's research on human sexual behavior. When I mentioned to a colleague my concerns over the complaints against me, he said: "Joe, you don't understand. Indiana University is where Alfred Kinsey did his research."

In my 2015 book entitled The Insurance Forum: A Memoir, I described an incident that occurred in 1965. Here is what I said in the book:

A friend on the faculty at a university in a state other than Indiana invited me to visit his school and present a guest lecture. He said his school might offer me a faculty position. He told me his school would cover my travel expenses. I made the visit, presented the lecture, and met some people there.

Shortly after my return to Bloomington, I received a telephone call from my friend informing me the expense check was in the mail. He said he had bad news he felt obligated to share. He said he was embarrassed to inform me there would be no offer of a position. He explained that the chief executive officer of a major insurance company in the school's state had learned of my visit and had told school officials there would be no further contributions by the company to the school if I was appointed to the faculty. My friend said his school decided it could not afford to antagonize a major donor.

My immediate thought was that a financial threat by a donor to influence a faculty hiring decision is not tolerated by a great university, and I was grateful to have avoided a disastrous career move. All I said to my friend was that I understood, and I thanked him for the explanation. That was the first and last time I considered leaving Indiana University.

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Email: jmbelth@gmail.com

Blog: www.josephmbelth.com

No. 429: The U.S. Department of Justice Sues Georgia over the State's New Voter Suppression Law

Background

In No. 415 (April 5, 2021), I discussed a lawsuit challenging Georgia's recent election law, often called Senate Bill 202 (SB 202). It was enacted in March 2021 by the Republican-controlled legislature, and signed by Governor Brian Kemp, a supporter of former president Trump. The private signing ceremony was attended by several white men in front of a painting that appears to be an old southern plantation. The new law is called an "election security law" by proponents, and a "voter suppression law" by opponents. If the Republicans dislike the election result in any county or precinct, the new law would allow the result to be altered to their liking.

The DOJ Complaint

On June 25, 2021, the U.S. Department of Justice (DOJ) filed a 46-page complaint against Georgia, its election board, and its Secretary of State. Attached to the complaint is a 99-page exhibit showing SB 202. (See U.S.A. v. Georgia, U.S. District Court, Northern District of Georgia, Case No. 1:21-cv-2575.)

DOJ alleges that SB 202 was enacted "with knowledge of the disproportionate effect that the challenged provisions . . . would have on Black voters' ability to participate in the political process on an equal basis with white voters." DOJ asks the court for declaratory relief and injunctive relief. Specifically, DOJ seeks an order declaring that the challenged provisions of SB 202 violate the Voting Rights Act of 1965 and the voting guarantees of the Fourteenth and Fifteenth Amendments to the U.S. Constitution. DOJ also seeks an order enjoining the defendants from enforcing the challenged provisions, authorizing appointment of Federal observers to observe elections in Georgia, retaining jurisdiction, and requiring certain new voting changes in Georgia.

The Judge

The case was assigned to U.S. District Judge Jean-Paul "J.P." Boulee. President Trump nominated him in July 2018. The Senate confirmed him in June 2019.

The Supreme Court Ruling

On July 1, 2021, the U.S. Supreme Court handed down a major opinion relating to the U.S. Voting Rights Act of 1965. The Court ruled 6 to 3, along political lines, in favor of the Arizona Republican Party and against the Democratic National Committee. The majority opinion was written by Justice Alito, with which the other five conservatives concurred. Justice Gorsuch wrote a concurring opinion with which Justice Thomas concurred. Justice Kagan wrote a strong dissent, with which Justices Breyer and Sotomayor concurred. It remains to be seen what effect the Supreme Court's ruling will have on the DOJ's lawsuit against Georgia. (See Arizona Republican Party v. Democratic National Committee, U.S. Supreme Court, Case Nos. 19-1257 and 19-1258.)

General Observations

The DOJ lawsuit against Georgia is an important case. Also, it raises the question of whether DOJ will take similar action in other states where voter suppression laws have been enacted recently. Readers are encouraged to review No. 415, the DOJ complaint, and SB 202, each of which is available via a link above.

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Email: jmbelth@gmail.com

Blog: www.josephmbelth.com

No. 428: Executive Compensation in the Insurance Industry—Data for 2020 from 2021 Filings with the SEC

Background

The Insurance Forum, the monthly newsletter I published for 40 years, began with the January 1974 issue and ended with the December 2013 issue. In 1975 I began publishing in the Forum data on executive compensation in the insurance industry. After ending the Forum, I began to publish less elaborate tabulations of executive compensation data through blog posts. The most recent posts are No. 381 (July 13, 2020), No. 385 (August 7, 2020), and No. 404 (December 23, 2020), in which I published data for 2019 from my three sources: the Securities and Exchange Commission (SEC), the New York State Department of Financial Services (DFS), and the Nebraska Department of Insurance (NDI).

In my 2015 book entitled The Insurance Forum: A Memoir, in Chapter 24, I described the history of my executive compensation tabulations. Here I show data for 2020 from the SEC. I plan to show data for 2020 from the DFS and the NDI later.

SEC Data

During the final seven years of the Forum, I showed data for individuals who received at least $1 million in the year covered. In the current tabulation below, I show SEC data for individuals who received at least $5 million in 2020. Each figure in the tabulation is the "Total" shown in the SEC's "summary compensation tables" for 2020. The five components of the "Total" are "Salary," "Bonus," "Stock Awards," "Non-Equity Incentive Plan Compensation," and "All Other Compensation." Where more than one individual in a company is shown, they are listed in descending order of compensation.

The summary compensation tables for 2020 for most companies are in proxy statements filed in advance of the 2021 annual meeting of shareholders. For the two Canadian companies, Manulife Financial and Sun Life Financial, the summary compensation tables for 2020 are in 6-K annual reports, and the figures shown are in Canadian dollars. If you want to see any of the summary compensation tables for 2020, go to the EDGAR Search page of the SEC web site and key in the name of the company in which you are interested.

SEC Data for 2020
AFLAC Inc
Daniel P Amos	$14,099,140
Frederick J Crawford	5,130,661
Alleghany Corp
Weston M Hicks	7,451,772
Allstate Corp
Thomas J Wilson	18,009,544
Don Civgin	5,873,381
Glenn T Shapiro	5,032,673
Ambac Financial Group Inc
Claude LeBlanc	6,011,501
American Financial Group Inc
Carl H Lindner III	9,631,170
S Craig Lindner	9,596,241
American International Group Inc
Peter Zaffino	24,066,986
Brian Duperreault	18,810,374
Mark D Lyons	10,236,456
Douglas A Dachille	8,666,267
Lucy Fato	8,592,190
Ameriprise Financial Inc
James M Cracchiolo	20,794,703
Walter S Berman	9,200,374
William F Truscott	7,333,308
Colin Moore	5,955,390
Anthem Inc
Gail K Boudreaux	17,109,952
Gloria M McCarthy	5,530,661
John E Gallina	5,401,735
Peter D Haytaian	5,387,111
Felicia F Norwood	5,236,403
Aon plc
Gregory C Case	20,294,496
Christa Davies	12,243,943
Eric Andersen	6,674,303
Arch Capital Group Ltd
Marc Grandisson	8,779,832
Arthur J Gallagher & Co
Pat Gallagher	11,177,460
Assurant Inc
Alan B Colberg	11,855,966
Gene E Mergelmeyer	5,649,562
Assured Guaranty Ltd
Dominic J Frederico	10,876,524
AXIS Capital Holdings Ltd
Albert A Benchimol	7,265,614
Berkshire Hathaway Inc
Gregory E Abel	19,014,250
Ajit Jain	19,014,250
Brighthouse Financial Inc
Eric Steigerwalt	8,133,344
Brunswick Corp
David M Foulkes	7,820,863
Centene Corp
Michael F Neidorff	24,956,777
Kenneth A. Burdick	15,042,226
Jeffrey A Schwaneke	8,006,713
Brandy L Burkhalter	7,807,113
Jesse N Hunter	7,679,402
Chubb Ltd
Evan G Greenberg	20,328,167
John W Keogh	8,627,780
John J Lupica	6,722,380
Paul J Krump	6,438,889
Philip V Bancroft	5,012,115
Cigna Corp
David M Cordani	19,929,493
Timothy C Wentworth	10,780,189
Eric P Palmer	6,336,563
Matthew G Manders	6,204,451
CNA Financial Corp
Dino E Robusto	11,469,174
Douglas M Worman	5,157,796
CNO Financial Group Inc
Gary C Bhojwani	8,260,886
CVS Health Corp
Larry J Merlo	23,043,822
Jonathan C Roberts	13,001,212
Karen S Lynch	11,307,916
Eva C Boratto	8,921,153
Alan M Lotvin MD	7,472,175
Equitable Holdings Inc
Mark Pearson	14,874,955
Seth Bernstein	9,402,563
Jeffrey Hurd	5,359,626
Nick Lane	5,225,351
Anders Malmström	5,120,515
Everest Re Group Ltd
Juan C Andrade	8,063,212
Mark Kociancic	5,791,714
Fidelity National Financial Inc
Raymond R Quirk	9,716,868
First American Financial Corp
Dennis J Gilmore	11,173,959
Kenneth D DeGiorgio	5,538,235
Christopher M Leavell	5,528,016
Genworth Financial Inc
Kevin D Schneider	9,087,804
Daniel J Sheehan IV	8,635,193
Thomas J McInerney	7,357,588
Globe Life Inc
Gary L Coleman	9,158,910
Larry M Hutchison	8,443,364
Hartford Financial Services Group Inc
Christopher Swift	11,806,195
Douglas Elliot	7,542,532
Heritage Insurance Holdings Inc
Bruce Lucas	7,787,404
Humana Inc
Bruce D Broussard	16,489,639
Brian A Kane	5,543,558
Kemper Corp
Joseph P Lacher Jr	9,251,315
Lincoln National Corp
Dennis R Glass	14,300,822
Loews Corp
James S Tisch	5,838,853
David B Edelson	5,698,625
Kenneth I Siegel	5,571,515
Jonathan M Tisch	5,066,530
Magellan Health Inc
Kenneth J Fasola	7,516,266
James Murray	7,382,021
Manulife Financial Corp
(Canadian Dollars)
Roy Gori	14,697,088
Marianne Harrison	5,904,563
Anil Wadhwani	5,700,992
Scott Hartz	5,353,629
Phil Witherington	5,171,813
Marsh & McLennan Companies Inc
Daniel S Glaser	19,695,980
John Q Doyle	8,202,312
Mark C McGivney	5,943,911
Peter C Heam	5,734,867
Martine Ferland	5,145,730
MetLife Inc
Michel A Khalaf	15,434,255
Bill Pappas	7,063,257
Steven J Goulart	6,839,384
John D McCallion	6,800,860
Ramy Tadros	5,681,122
MGIC Investment Corp
Timothy Mattke	5,517,169
Molina Healthcare Inc
Joseph M Zubretsky	17,812,327
Marc S Russo	6,189,788
Mr Cooper Group Inc
Jay Bray	9,261,290
Christopher Marshall	5,747,012
Anthony Ebers	5,261,400
Primerica Inc
Glenn J Williams	5,279,867
Principal Financial Group Inc
Daniel J Houston	15,614,418
Timothy M Dunbar	5,414,165
Deanna D Strable-Soethout	5,234,424
Progressive Corp
Susan Patricia Griffith	15,220,523
Protective Life Ins Co
Richard J Bielen	6,467,503
Prudential Financial Inc
Charles F Lowrey	14,990,254
Robert M Falzon	11,986,516
Stephen Pelletier	9,257,246
Scott G Sleyster	7,672,098
Andrew F Sullivan	6,271,772
Kenneth Y Tanji	5,040,380
Radian Group Inc
Richard G Thornberry	7,944,227
Reinsurance Group of America Inc
Anna Manning	9,044,233
RenaissanceRe Holdings Ltd
Kevin J O'Donnell	9,556,635
Sun Life Financial Inc
(Canadian Dollars)
Dean A Connor	10,090,374
Stephen C Peacher	7,152,382
Travelers Companies Inc
Alan D Schnitzer	18,990,270
Avrohom J Kess	6,576,439
Gregory C Toczydlowski	5,446,367
Michael F Klein	5,136,598
Daniel S Frey	5,122,446
UnitedHealth Group Inc
David S Wichmann	17,872,713
Andrew Witty	12,857,176
Dirk C McMahon	12,606,484
John F Rex	12,597,062
Patricia L Lewis	7,190,693
Unum Group
Richard P McKenney	13,258,738
Voya Financial Inc
Rodney O Martin Jr	13,597,008
Christine Hurtsellers	5,414,402
W R Berkley Corp
William R Berkley	10,153,856
W Robert Berkley Jr	9,982,728
White Mountains Ins Group Ltd
G Manning Rountree	7,170,628
Frank R Bazos	5,417,208
Reid T Campbell	5,255,382

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Email: jmbelth@gmail.com

Blog: www.josephmbelth.com

No. 427: New York's Regulation 187—A Brief Update

Background

In No. 420 (May 7, 2021), I wrote about legal developments relating to amended Regulation 187 (Reg 187) issued by the New York State Department of Financial Services (DFS). The Independent Insurance Agents and Brokers and other entities and individuals (collectively, the petitioners) challenged in court the constitutionality of Reg 187.

In July 2019, the trial court in New York found in favor of DFS by ruling that Reg 187 is constitutional. The petitioners appealed the ruling.

In April 2021, an appellate court in New York reversed the trial court's ruling by finding that Reg 187 is unconstitutional. In No. 420, I said DFS was reviewing the appellate court's ruling.

The Notice of Appeal

On May 27, 2021, DFS filed a Notice of Appeal to the Court of Appeals, which is New York State's highest court. In the notice, DFS said it is appealing from every part of the appellate ruling. At this time, I do not know when the DFS appellate brief will be filed. I plan to report further developments in this important litigation.

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Email: jmbelth@gmail.com

Blog: www.josephmbelth.com

No. 426: More on Bitcoin after Recent Ransomware Attacks

Several years ago I posted two items about Bitcoin, a form of "virtual currency" or "cryptocurrency." In view of recent ransomware attacks involving Bitcoin, I decided to prepare this update. My previous posts are No. 34 (March 3, 2014) and No. 268 (May 30, 2018). With regard to each of the four sections of this update, I provide a link to allow interested readers to see the relevant document.

The EscoCapital Case

On April 30, 2021, the Texas State Securities Board (TSSB) issued an Emergency Cease and Desist Order directed at EscoCapital and Anthony Jerome. The order requires the respondents to cease and desist immediately from: (1) offering for sale any security in Texas until the security is registered with the Securities Commissioner or is offered for sale pursuant to an exemption under the Texas Securities Act; (2) acting as a securities dealer, agent, investment adviser, or investment adviser representative in Texas until they are registered with the Securities Commissioner or are acting pursuant to an exemption from registration under the Act; (3) engaging in any fraud in connection with the offer for sale of any security in Texas; and (4) offering securities in Texas through an offer containing a statement that is materially misleading or otherwise likely to deceive the public.

The First Unum/Paul Revere Case

On May 12, 2021, the New York State Department of Financial Services (DFS) entered into a Consent Order with First Unum Life Insurance Company and The Paul Revere Life Insurance Company. The order refers to two "Cybersecurity Events" involving violations of New York State statutes or DFS regulations. The companies will pay a civil monetary penalty of $1.8 million to DFS and meet other requirements.

The Tilford Case

On June 8, 2021, the TSSB issued an Enforcement Action entitled "Richard Gregory Tilford: Convicted." Tilford (of Arlington, Texas) was sentenced to serve 40 years in state prison for engaging in a fraudulent digital marketing investment scheme. He was also sentenced to serve ten years in prison for each of six counts of selling unregistered securities, and ten years in prison for each of six counts of acting as an unregistered dealer. The sentences will run concurrently. Tilford had been indicted in Collin County, Texas, in 2018.

The TSSB Guide

For those interested in cryptocurrencies, I recommend a guide prepared by the TSSB entitled The Investor's Guide to Cryptocurrency Offerings. The guide consists of seven parts: (1) Fiat v. Virtual Currency; (2) How Cryptocurrencies Work; (3) Initial Coin Offerings; (4) Digital Money, Real Risk; (5) Crypto-Scams; (6) Enforcement Actions; and (7) Glossary.

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Email: jmbelth@gmail.com

Blog: www.josephmbelth.com

No. 425: An Important New Book about the United States Secret Service

Carol Leonnig is a top investigative reporter at The Washington Post. She holds three Pulitzer prizes. Her new book, published May 18, 2021, is entitled Zero Fail and subtitled The Rise and Fall of the Secret Service. When I first saw the 532-page book, I was intimidated. However, I got over that feeling. When I started reading the book, I was hooked, and read the entire book.

The book is divided into five major parts: (1) The Tragedy that Birthed a New Secret Service, Kennedy to Nixon, 1963-1974; (2) Meeting the Test, Ford to Clinton, 1974-1999; (3) Terror and Politics, The Bush Years, 2000-2007; (4) The Wheels Come Off, The Obama Years, 2008-2015; (5) Sliding Backward, The Trump Years, 2016-2020. The book also includes a Prologue and an Epilogue. The final section of the Epilogue summarizes the book. It reads:

Today the [Secret] Service remains spread dangerously thin. In addition to protecting a president and vice president and their families, and key senior leaders, the Service also protects hundreds of foreign leaders who visit the United States every year, investigates a broad range of financial crimes, assesses and investigates violent threats whether they are made in bars, in written letters, or on Twitter, researches the traits of school shooters to help communities prevent future attacks, helps local police track down missing and exploited children, and much more. [One Trump Administration] official told me they and their fellow senior national security advisers revere the commitment of so many of the Secret Service's soldiers on the front line, but they remain haunted that the agency hasn't been given the money, staff, or tools to do all its jobs. This neglect creates an opening for a serious attack on our democracy. "Someone in the near future needs to sit down and figure out: What is their mission? Because they can't do the mission they have now," the person said. "These people are patriots. We're letting them down and we're leaving the country at risk." It should haunt us all.

The book is superb. I think it is essential reading for anyone concerned about the survival of our democracy.

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Email: jmbelth@gmail.com

Blog: www.josephmbelth.com