JPMorgan Admits to Widespread Recordkeeping Failures and Agrees to Pay $125 Million Penalty to Resolve SEC Charges

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The Point of Sale System

JPMorgan Admits to Widespread Recordkeeping Failures and Agrees to Pay $125 Million Penalty to Resolve SEC Charges

Firm also agrees to implement significant improvements to its compliance controls

FOR IMMEDIATE RELEASE
2021-262

Washington D.C., Dec. 17, 2021 —

The Securities and Exchange Commission today announced charges against J.P. Morgan Securities LLC (JPMS), a broker-dealer subsidiary of JPMorgan Chase & Co., for widespread and longstanding failures by the firm and its employees to maintain and preserve written communications. JPMS admitted the facts set forth in the SEC’s order and acknowledged that its conduct violated the federal securities laws, and agreed to pay a $125 million penalty and implement robust improvements to its compliance policies and procedures to settle the matter.

“Since the 1930s, recordkeeping and books-and-records obligations have been an essential part of market integrity and a foundational component of the SEC’s ability to be an effective cop on the beat. As technology changes, it’s even more important that registrants ensure that their communications are appropriately recorded and are not conducted outside of official channels in order to avoid market oversight,” said SEC Chair Gary Gensler. “Unfortunately, in the past we’ve seen violations in the financial markets that were committed using unofficial communications channels, such as the foreign exchange scandal of 2013. Books-and-records obligations help the SEC conduct its important examinations and enforcement work. They build trust in our system. Ultimately, everybody should play by the same rules, and today’s charges signal that we will continue to hold market participants accountable for violating our time-tested recordkeeping requirements.”

As described in the SEC’s order, JPMS admitted that from at least January 2018 through November 2020, its employees often communicated about securities business matters on their personal devices, using text messages, WhatsApp, and personal email accounts. None of these records were preserved by the firm as required by the federal securities laws. JPMS further admitted that these failures were firm-wide and that practices were not hidden within the firm. Indeed, supervisors, including managing directors and other senior supervisors – the very people responsible for implementing and ensuring compliance with JPMS’s policies and procedures – used their personal devices to communicate about the firm’s securities business.

JPMS received both subpoenas for documents and voluntary requests from SEC staff in numerous investigations during the time period that the firm failed to maintain required records. In responding to these subpoenas and requests, JPMS frequently did not search for relevant records contained on the personal devices of its employees. JPMS acknowledged that its recordkeeping failures deprived the SEC staff of timely access to evidence and potential sources of information for extended periods of time and in some instances permanently. As such, the firm’s actions meaningfully impacted the SEC’s ability to investigate potential violations of the federal securities laws.

“Recordkeeping requirements are core to the Commission’s enforcement and examination programs and when firms fail to comply with them, as JPMorgan did, they directly undermine our ability to protect investors and preserve market integrity,” said Gurbir S. Grewal, Director of the SEC’s Division of Enforcement. “We encourage registrants to not only scrutinize their document preservation processes and self-report failures such as those outlined in today’s action before we identify them, but to also consider the types of policies and procedures JPMorgan implemented to redress its failures in this case.”

“As today’s order reflects, JPMorgan’s failures hindered several Commission investigations and required the staff to take additional steps that should not have been necessary,” said Sanjay Wadhwa, Deputy Director of Enforcement. “This settlement reflects the seriousness of these violations. Firms must share the mission of investor protection rather than inhibit it with incomplete recordkeeping.”

JPMS agreed to the entry of an order in which it admitted to the SEC’s factual findings and its conclusion that JPMS’s conduct violated Section 17(a) of the Securities Exchange Act of 1934 and Rules 17a-4(b)(4) and 17a-4(j) thereunder, and that the firm failed reasonably to supervise its employees with a view to preventing or detecting certain of its employees’ aiding and abetting violations. JPMS was ordered to cease and desist from future violations of those provisions, was censured, and was ordered to pay the $125 million penalty. JPMS also agreed to retain a compliance consultant to, among other things, conduct a comprehensive review of its policies and procedures relating to the retention of electronic communications found on personal devices and JPMS’s framework for addressing non-compliance by its employees with those policies and procedures.

As a result of the findings in this investigation, the SEC has commenced additional investigations of record preservation practices at financial firms. Firms that believe that their record preservation practices do not comply with the securities laws are encouraged to contact the SEC at BDRecordsPreservation@sec.gov.

Separately, the Commodity Futures Trading Commission announced a settlement with JPMS and affiliated entities for related conduct.

The SEC’s investigation, which is continuing, has been conducted by Joshua Brodsky, Zachary Sturges, Theresa Gue, Andrew Dean, Osman Nawaz, Adam Grace, John Enright, and Thomas P. Smith, Jr. of the New York Regional Office, and Laura K. Bennett, Christopher G. Margand, Margaret Y. Rubin, Sonia G. Torrico, and David A. Becker of the Home Office. The case is being supervised by Mr. Wadhwa, Richard R. Best, and Carolyn Welshhans. 

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Casework Assistance - Office of Senator Dianne Feinstein

Move the Truth
Office of Senator Dianne Feinstein
1 Post Street, Suite 2450,
San Francisco, CA 94104

1. CLICK HERE to fill out an immigration casework request form. Please note that only one signature by the subject of the form (either the petitioner or the beneficiary) is permitted, and the form must be signed by hand. Federal agencies will not accept forms with electronic signatures.

2. Please also draft a letter to the Senator describing your request.

3. For USCIS requests, please provide a copy of your most recent I-797C Notice of Action. If you are asking for an expedite request, please go over USCIS’s criteria for expedite requests and provide supplemental documents to support your claims.

4. Submit your signed form, letter to the Senator, and other relevant documents to casework@feinstein.senate.gov, by fax (415) 393-0710, or by mail to:

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Dominique Anne Yancey #132459

Attorney Profile

Dominique Anne Yancey #132459

License Status:  Inactive 

Address: 1302 Lexington Ln, Tuscaloosa, AL 35406-2700

Phone: Not Available  |  Fax: Not Available

Email: Not Available  |  Website: Not Available

• More about This Attorney

License Status, Disciplinary and Administrative History

All changes of license status due to nondisciplinary administrative matters and disciplinary actions.

Date	License Status	Discipline	Administrative Action
Present	Inactive
12/11/2020	Inactive
12/11/1987	Admitted to the State Bar of California

Additional Information:

• About the disciplinary system

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The Hostile Takeover Consultant for Oracle vs. PeopleSoft shares his serial tragedies

The Hostile Takeover Consultant Speaks 

This story is about Oracle, PeopleSoft, Workday and now Cerner 

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As darkness falls, the city seems different. By Richard Esposito

As darkness falls, the city seems different.

The current CEO and Chairman plus their billionaire owners should be charged with racketeering, obstruction of Justice

Someone Gets It

 September 12, 2001 Posted: 3:08 AM EDT (0708 GMT)

By Richard Esposito
Special to CNN

As darkness falls, the city seems different.

It is quiet. Streets are empty. Official cars covered with rubble dust are driving in silence.

The reports are of at least 78 police officers unaccounted for and perhaps 300 firefighters presumed dead. We may learn of other emergency workers who died racing into danger before the second plane struck the World Trade Center, desperately trying to save others, others who were already killed or about to die.

There are no official counts of how many are dead. But this can already be felt: the number will change a city and change a nation.

The mayor has said the numbers will be horrific. A former New York City police commissioner agrees the city will never be the same.

Now, the counting is being done by calculation. No exact numbers. Just facts that add up to a sum that is truly unthinkable.

The two main Trade Center towers that fell housed at least 50,000 workers. Beneath them is a subway concourse, where tens of thousands more arrived to work in lower Manhattan, exiting trains even as the planes arrived.

At this time, no one knows how many were killed by the impact of the planes, or the explosions or how many lay dying beneath the stories of rubble that cover the streets when the walls melted and collapsed.

Firefighter emergency beepers, the ones they wear to keep track of each other inside burning buildings, are slowly fading as batteries run out. Frantic cell phone calls have rescuers trying to dig out possible survivors.

But even if we had the numbers, we don't have the context to comprehend them. A bad year in Vietnam during the height of the war is one way to look at what happened yesterday in New York City.

The last time the Trade Center was hit, it was a car bomb. When that occurred, in 1993, most of the workers were evacuated. Then, the streets were cold, and there were snow flurries that people walked through when they crept out of the building. This time, there were people jumping from the building to try to get out.

By nightfall, correspondents on television were doing reports from in front of what would have been the Twin Towers as backdrop. Instead, there was an empty, dark night.

This will have an impact on people that will be known only in retrospect. Nothing recent compares. Not Waco nor Oklahoma City nor the beating of Rodney King.

I live in New York and the first thing I thought of was my daughter and whether she was safe. She was. Then, I thought about how this will affect her life. She is a little shy of seven. She may have an inkling that her world has changed. I did, when a little shy of seven I learned that John F. Kennedy was slain.

Last night, though, there was only shock, the kind of devastation that precedes mourning. After the attacks, midtown Manhattan seemed changed. The streets were crowded. But people moved slowly. You could hear voices, even from a taxi, of people talking to each other. It was very strange. No cell phones. Virtually no traffic.

Just an eerie twilight end to a terrible summer tragedy.

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Owner Of East Bay Tax Preparation Company Charged With

Owner Of East Bay Tax Preparation Company Charged With Tax Fraud

 

U.S. Attorneys » Northern District of California » News

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Department of Justice

U.S. Attorney’s Office

Northern District of California

---

FOR IMMEDIATE RELEASE

Thursday, December 2, 2021

Owner Of East Bay Tax Preparation Company Charged With Tax Fraud

Defendant Allegedly Aided in the Submission of More Than 40 Fraudulent Tax Returns and Hosted “Tax School” at which She Taught Prospective Tax Preparers How to Compose Fraudulent Tax Returns

OAKLAND – A federal criminal complaint unsealed today charges Traci Austin with aiding and assisting in the preparation of fraudulent tax returns, announced Acting U.S. Attorney Stephanie M. Hinds and Internal Revenue Service, Criminal Investigation, and IRS-Criminal Investigation Special Agent in Charge Mark H. Pearson.    

The complaint describes Austin, 44, of Brentwood, Calif., as the owner of a tax return preparation business called Emeryville Tax Services (“ETS”).  According to the complaint, Austin prepared materially false and fraudulent tax returns for her clients by including false and/or inflated Schedule A expenses, false and/or inflated Schedule C income and expenses, and false dependents.  By doing this, Austin fraudulently reduced her clients’ taxable income and tax liability, thereby resulting in larger refunds for the client and higher return preparation fee income for Austin.  The investigation has revealed that Austin allegedly assisted in the preparation of at least 42 fraudulent tax returns and an estimated tax loss of well over $697,000 to the federal government.

In addition to the false and fraudulent tax return preparation scheme, the complaint also alleges that since 2016, Austin has hosted a “Tax School” through ETS and charged a fee of at least $200 for students to attend the tax school.  According to the complaint, the goal of the tax school was to hire the attendees as preparers for ETS and prepare tax returns for ETS clients as well as the attendees’ own clients.  During the tax school, Austin allegedly instructed prospective tax preparers how to fraudulently manipulate tax returns to generate the maximum tax refund, and thus the maximum tax preparation fee by listing fictitious side businesses under Schedule C and fake business expenses on Schedule A, for example, the complaint describes how Austin taught her students how she created a fictitious dog grooming business for a client, created a fictitious profit and loss statement for the fake business, and how she instructed the client to print out some photos of dogs to support the idea of her fictitious business.

Austin is charged with aiding and assisting in the preparation of false and fraudulent federal income tax returns, in violation of 26 U.S.C. § 7206(2).  

The charges in the complaint are merely allegations and the defendant is presumed innocent unless proven guilty in a court of law.   

If convicted, Austin faces a maximum penalty of three years in prison and a $100,000 fine; however, any sentence following conviction would be imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.

Austin made her initial federal court appearance this morning before United States Magistrate Judge Kandis A. Westmore.  Austin remains out of custody and her next scheduled appearance is at 10 a.m., on February 24, 2022, for a status conference before Magistrate Judge Westmore.        

Assistant U.S. Attorney Abraham Fine is prosecuting the case with the assistance of Kay Konopaske and Helen Yee.  The prosecution is the result of an investigation by the Internal Revenue Service, Criminal Investigation.
 

Component(s): 

USAO - California, Northern

Updated December 2, 2021

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Chase Manhattan Bank and David Rockefeller

David Leslie Milne was Pete Bennett's grandfather accountant to the stars, billionaires and powerful. His clients were the goldplated ones from the 1920s to his death in 1962. Upon his according to family was David Rockefeller managed the family funds.

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ADDRESSING POLICE MISCONDUCT LAWS ENFORCED BY THE DEPARTMENT OF JUSTICE

Meet David Bremer former

roommate of Pete Bennett.  Dave was beat to death in the Martinez Death Facility just after the massive Data Breach at Target Corporation.

INJUNCTIVE RELIEF 

The amount of Police Misconduct directed at Pete Bennett and his somewhat off the charts.  

ADDRESSING POLICE MISCONDUCT LAWS ENFORCED BY THE DEPARTMENT OF JUSTICE

The vast majority of the law enforcement officers in this country perform their very difficult jobs with respect for their communities and in compliance with the law. Even so, there are incidents in which this is not the case. This document outlines the laws enforced by the United States Department of Justice (DOJ) that address police misconduct and explains how you can file a complaint with DOJ if you believe that your rights have been violated.

Federal laws that address police misconduct include both criminal and civil statutes. These laws cover the actions of State, county, and local officers, including those who work in prisons and jails. In addition, several laws also apply to Federal law enforcement officers. The laws protect all persons in the United States (citizens and non-citizens).

Each law DOJ enforces is briefly discussed below. In DOJ investigations, whether criminal or civil, the person whose rights have been reportedly violated is referred to as a victim and often is an important witness. DOJ generally will inform the victim of the results of the investigation, but we do not act as the victim's lawyer and cannot give legal advice as a private attorney could. 

The various offices within DOJ that are responsible for enforcing the laws discussed in this document coordinate their investigative and enforcement efforts where appropriate. For example, a complaint received by one office may be referred to another if necessary to address the allegations. In addition, more than one office may investigate the same complaint if the allegations raise issues covered by more than one statute. 

What is the difference between criminal and civil cases? Criminal and civil laws are different. Criminal cases usually are investigated and handled separately from civil cases, even if they concern the same incident. In a criminal case, DOJ brings a case against the accused person; in a civil case, DOJ brings the case (either through litigation or an administrative investigation) against a governmental authority or law enforcement agency. In a criminal case, the evidence must establish proof "beyond a reasonable doubt," while in civil cases the proof need only satisfy the lower standard of a "preponderance of the evidence." Finally, in criminal cases, DOJ seeks to punish a wrongdoer for past misconduct through imprisonment or other sanction. In civil cases, DOJ seeks to correct a law enforcement agency's policies and practices that fostered the misconduct and, where appropriate, may require individual relief for the victim(s). 

FEDERAL CRIMINAL ENFORCEMENT 

It is a crime for one or more persons acting under color of law willfully to deprive or conspire to deprive another person of any right protected by the Constitution or laws of the United States. (18 U.S.C. §§ 241, 242). "Under color of law" means that the person doing the act is using power given to him or her by a governmental agency (local, State, or Federal). A law enforcement officer acts "under color of law" even if he or she is exceeding his or her rightful power. The types of law enforcement misconduct covered by these laws include excessive force, sexual assault, intentional false arrests, theft, or the intentional fabrication of evidence resulting in a loss of liberty to another. Enforcement of these provisions does not require that any racial, religious, or other discriminatory motive existed.  What remedies are available under these laws? These are criminal statutes. Violations of these laws are punishable by fine and/or imprisonment. There is no private right of action under these statutes; in other words, these are not the legal provisions under which you would file a lawsuit on your own.

FEDERAL CIVIL ENFORCEMENT

"Police Misconduct Provision"

This law makes it unlawful for State or local law enforcement officers to engage in a pattern or practice of conduct that deprives persons of rights protected by the Constitution or laws of the United States. (34 U.S.C. § 12601). The types of conduct covered by this law can include, among other things, excessive force, discriminatory harassment, false arrests, coercive sexual conduct, and unlawful stops, searches or arrests. In order to be covered by this law, the misconduct must constitute a "pattern or practice" -- it may not simply be an isolated incident. The DOJ must be able to show in court that the agency has an unlawful policy or that the incidents constituted a pattern of unlawful conduct. However, unlike the other civil laws discussed below, DOJ does not have to show that discrimination has occurred in order to prove a pattern or practice of misconduct. What remedies are available under this law? The remedies available under this law do not provide for individual monetary relief for the victims of the misconduct. Rather, they provide for injunctive relief, such as orders to end the misconduct and changes in the agency's policies and procedures that resulted in or allowed the misconduct. There is no private right of action under this law; only DOJ may file suit for violations of the Police Misconduct Provision. 

Title VI of the Civil Rights Act of 1964 and the "OJP Program Statute"

Together, these laws prohibit discrimination on the basis of race, color, national origin, sex, and religion by State and local law enforcement agencies that receive financial assistance from DOJ. (42 U.S.C. § 2000d, et seq. and 34 U.S.C. § 10228). These laws prohibit both individual instances and patterns or practices of discriminatory misconduct, i.e., treating a person differently because of race, color, national origin, sex, or religion. The misconduct covered by Title VI and the OJP (Office of Justice Programs) Program Statute includes, for example, harassment or use of racial slurs, discriminatory arrests, discriminatory traffic stops, coercive sexual conduct, retaliation for filing a complaint with DOJ or participating in the investigation, discriminatory use of force, or refusal by the agency to respond to complaints alleging discriminatory treatment by its officers. What remedies are available under these laws? DOJ may seek changes in the policies and procedures of the agency to remedy violations of these laws and, if appropriate, also seek individual remedial relief for the victim(s). Individuals also have a private right of action in certain circumstances under Title VI and under the OJP Program Statute; in other words, you may file a lawsuit yourself under these laws. However, you must first exhaust your administrative remedies by filing a complaint with DOJ if you wish to file in Federal Court under the OJP Program Statute.

Title II of the Americans with Disabilities Act of 1990 and Section 504 of the Rehabilitation Act of 1973

The Americans with Disabilities Act (ADA) and Section 504 prohibit discrimination against individuals on the basis of disability. (42 U.S.C. § 12131, et seq. and 29 U.S.C. § 794). These laws protect all people with disabilities in the United States. An individual is considered to have a "disability" if he or she has a physical or mental impairment that substantially limits one or more major life activities, has a record of such an impairment, or is regarded as having such an impairment. 

The ADA prohibits discrimination on the basis of disability in all State and local government programs, services, and activities regardless of whether they receive DOJ financial assistance; it also protects people who are discriminated against because of their association with a person with a disability. Section 504 prohibits discrimination by State and local law enforcement agencies that receive financial assistance from DOJ. Section 504 also prohibits discrimination in programs and activities conducted by Federal agencies, including law enforcement agencies. 

These laws prohibit discriminatory treatment, including misconduct, on the basis of disability in virtually all law enforcement services and activities. These activities include, among others, interrogating witnesses, providing emergency services, enforcing laws, addressing citizen complaints, and arresting, booking, and holding suspects. These laws also prohibit retaliation for filing a complaint with DOJ or participating in the investigation. What remedies are available under these laws? If appropriate, DOJ may seek individual relief for the victim(s), in addition to changes in the policies and procedures of the law enforcement agency. Individuals have a private right of action under both the ADA and Section 504; you may file a private lawsuit for violations of these statutes. There is no requirement that you exhaust your administrative remedies by filing a complaint with DOJ first. 

HOW TO FILE A COMPLAINT WITH DOJ

Criminal Enforcement

If you would like to file a complaint alleging a violation of the criminal laws discussed above, you may contact the Federal Bureau of Investigation (FBI), which is responsible for investigating allegations of criminal deprivations of civil rights. You may also contact the United States Attorney's Office (USAO) in your district. The FBI and USAOs have offices in most major cities and have publicly-listed phone numbers.

You can find your local office here:
https://www.fbi.gov/contact-us

Civil Enforcement

If you would like to report a violation of the Police Misconduct Statute, Title VI, or the OJP Program Statute, contact the Justice Department at civilrights.justice.gov.

How do I file a complaint about the conduct of a law enforcement officer from a Federal agency?

If you believe that you are a victim of criminal misconduct by a Federal law enforcement officer (such as Immigration and Customs Enforcement; the FBI; Alcohol, Tobacco, Firearms and Explosives; Drug Enforcement Agency, United States Marshals Service, or the Border Patrol), you should follow the procedures discussed above concerning how to file a complaint alleging violations of the criminal laws we enforce. If you believe that you have been subjected by a Federal law enforcement officer to the type of misconduct discussed above concerning "Federal Civil Enforcement," visit civilrights.justice.gov.

Reproduction of this document is encouraged.

This flyer is not intended to be a final agency action, has no legally binding effect, and has no force or effect of law.  This document may be rescinded or modified in the Department’s complete discretion, in accordance with applicable laws.  This flyer does not establish legally enforceable rights or responsibilities beyond what is required by the terms of the applicable statutes, regulations, or binding judicial precedent.  For more information, see "Memorandum for All Components: Prohibition of Improper Guidance Documents," from Attorney General Jefferson B. Sessions III, November 16, 2017.

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United States Department of Labor / Government Entities: Working Together to Gain the Greatest Impact

Move the Truth

The current CEO and Chairman plus their billionaire owners should be charged with racketeering, obstruction of Justice

Kill the witness in Bennett vs. Southern Pacific

Connecting NCR

Government Entities: Working Together to Gain the Greatest Impact

• Employment Development Department
• Department of Consumer Affairs
• Department of Industrial Relations
• California Department of Insurance
• Franchise Tax Board
• California Department of Tax and Fee Administration
• Department of Justice
• United States Department of Labor
• California Department of Alcoholic Beverage Control
• Internal Revenue Service

Employment Development Department

The Employment Development Department’s (EDD) Tax Branch works with employers to collect California’s employment taxes and data to support the employment security, child support, and personal income tax programs. The Tax Branch is committed to providing service to California employers and Unemployment Insurance, State Disability Insurance, and Paid Family Leave benefit claimants and to increasing voluntary compliance with payroll tax laws through education, simplified reporting processes, and the promotion of fair business competition.

The EDD’s Investigation Division Criminal Tax Enforcement Program is a specialized law enforcement unit that investigates criminal violations of the CUIC, the California Penal Code, and the United States Code for federal prosecutions. This unit is staffed by sworn peace officers who work with law enforcement agencies throughout California and the JESF partner agencies to identify and prosecute employer fraud. They conduct surveillance, perform undercover operations, interview witnesses, initiate search warrants, and submit completed investigations to prosecutors to convict individuals who commit employment tax fraud. The EDD determines if the convicted party made restitution, is still on active probation, and obeys all laws with respect to the future filing of returns and payments. The conviction itself and the collection of the tax liabilities play an integral part in deterring the underground economy. The EDD also collaborates on workers’ compensation insurance investigations related to state payroll tax violations.

Department of Consumer Affairs

The Department of Consumer Affairs (DCA) protects and serves California consumers and ensures a competent and fair marketplace. The DCA helps consumers learn how to protect themselves from unscrupulous and unqualified individuals. The DCA protects professionals from unfair competition by identifying unlicensed practitioners.

The DCA – Contractors’ State License Board (CSLB) protects consumers by licensing and regulating California’s construction industry. There are about 300,000 licensed contractors in the State, in 43 different licensing classifications. In addition to consumer education on contractor and construction law, CSLB activities include: administer prospective licensee examinations; issue licenses; investigate complaints against licensed and unlicensed contractors; issue citations; suspend or revoke licenses; and seek administrative, criminal, and civil sanctions against violators. The CSLB’s Statewide Investigative Fraud Team (SWIFT) is set up to monitor and combat illegal activity. They have teams throughout the state that conduct sting operations on a regular basis and sweep construction sites. They also conduct joint operations and sweeps with other state agencies dedicated to combat underground activity.

The DCA – Bureau of Automotive Repair (BAR) investigates general auto repair complaints and ensures that shops comply with Smog Check statutes. Each year, the BAR handles more than 14,800 complaints related to auto repair and/or Smog Check inspections. The BAR staff investigates complaints and negotiates with the shop on the consumer’s behalf to achieve a mutually agreeable resolution. The bulk of complaints are resolved by mediation. Each year, the BAR returns over $6.3 million to California consumers in the form of direct refunds, rework, or adjustments.

The DCA – Bureau of Security and Investigative Services (BSIS) protects consumers by licensing and regulating the following industries: alarm company operator and alarm company employees; locksmith companies and locksmith company employees; private investigators; private patrol operators and security guards; proprietary private security officers and employers; repossessor agencies and repossessor agency employees; and training facilities and training instructors. As part of its mission, the BSIS actively investigates complaints against its licensees and works to punish unlicensed business operations. This includes the suspension and revocation of licenses and seeking administrative, criminal, and civil sanctions against violators. Undercover sting and sweep operations are conducted on an ongoing basis throughout California. The BSIS also educates consumers, administers examinations to validate prospective licensees, and issues licenses and permits.

Department of Industrial Relations

The Department of Industrial Relations (DIR) – Division of Labor Standards Enforcement’s (DLSE), Bureau of Field Enforcement is responsible for investigation and enforcement of statutes covering workers’ compensation insurance coverage, child labor, cash pay, unlicensed contractors, Industrial Welfare Commission orders, and group claims involving minimum wage and overtime claims. The Bureau of Field Enforcement also handles criminal investigations involving these group claims.

The DIR – Division of Occupational Safety and Health’s enforcement unit has jurisdiction over every employment situation and place of employment in California which is necessary to adequately enforce and administer all occupational safety and health standards and regulations. They conduct inspections of California workplaces in response to a report of an industrial accident, a complaint about an occupational safety and health hazard, or as part of an inspection program targeting industries which have a high rate of occupational hazards, fatalities, injuries, or illnesses.

California Department of Insurance

The California Department of Insurance (CDI) ensures that consumers are protected; the insurance marketplace is fostered to be vibrant and stable; the regulatory process is maintained as open and equitable; and the law is enforced fairly and impartially. The Fraud Division is charged with investigating insurance fraud, which includes the crimes of intentional misrepresentation of payroll and employee staffing in order to obtain lower rates for workers’ compensation insurance. Studies suggests that the aggressive anti-fraud campaign by the CDI, the district attorneys, the insurance industry, and California employers continues to play a substantial role in reducing crime and helps lower workers’ compensation insurance premiums for employers statewide.

Franchise Tax Board

The Franchise Tax Board’s (FTB) primary function is to administer the Revenue and Taxation Code. Elected officials determine the tax policy for raising revenue. Under the direction of the FTB’s Chief Law Enforcement Officer, the Criminal Investigation Bureau (CIB) enforces the criminal provisions of the Revenue and Taxation Code. The CIB’s principal mission is to identify, investigate, prosecute and deter tax evasion and fraud, and encourage compliance with California income tax laws while maintaining the public’s trust through publicity. The CIB takes over where voluntary compliance and civil enforcement efforts end. Special agents with full peace officer powers investigate alleged criminal violations of the Revenue and Taxation Code, principally income tax fraud and evasion, and assist in prosecuting non-compliant individuals. The special agents work cases independently (agency only) and partner with city, county, State and federal agencies (jointly) when other charges exist. The special agents’ efforts are supported by forensic auditors, collectors, analysts and support staff; basically a micro-organization all in one bureau. The CIB also relies on a strong collaborative enterprise to accomplish their mission.

California Department of Tax and Fee Administration

The California Department of Tax and Fee Administration (CDTFA) administers tax programs in four general areas: sales and use taxes, property taxes, special taxes and fees, and the tax appellate program. The Investigation Division and Special Operations Bureau plans, organizes, directs, and oversees all criminal investigative activities for the various programs administered by the CDTFA. Its goals are to identify tax evasion and new fraud schemes, and actively investigate and assist in the prosecution of individuals who are violating the laws administered by the CDTFA.

Department of Justice

The Department of Justice Attorney General works to protect California’s workers, legitimate businesses, and taxpayers through the Underground Economy Unit. The Underground Economy Unit brings civil and criminal actions against persons engaged in the underground economy. It has used California’s laws to obtain restitution of unpaid wages, civil penalties, and injunctions to bring businesses into compliance with applicable labor and employment, tax, and licensing laws. These enforcement efforts deter underground economy violations, recapture lost revenues, and protect workers and legitimate businesses from illegal and predatory enterprises. The Underground Economy Unit has prosecuted cases involving: wage, tax, and insurance issues including the theft of wages, unpaid overtime, denial of breaks, payroll tax evasion, and misclassification of employees as independent contractors; patterns of safety violations leading to fatal workplace injuries; workers’ compensation insurance premium fraud; and the illegal avoidance of workers’ compensation coverage for employees.

United States Department of Labor

The United States Department of Labor’s mission is to foster, promote, and develop the welfare of the wage earners, job seekers, and retirees of the United States; improve working conditions; advance opportunities for profitable employment; and assure work-related benefits and rights. The Fair Labor Standards Act prescribes standards for wages and overtime pay, which affect most private and public employment. The act is administered by the Wage and Hour Division. It requires employers to pay covered employees, who are not otherwise exempt, at least the federal minimum wage and overtime pay of one and one-half-times the regular rate of pay. For nonagricultural operations, it restricts the hours that children under age 16 can work and forbids the employment of children under age 18 in certain jobs deemed too dangerous. For agricultural operations, it prohibits the employment of children under age 16 during school hours and in certain jobs deemed too dangerous. The Wage and Hour Division also enforces the labor standards provisions of the Immigration and Nationality Act that apply to aliens authorized to work in the United States under certain nonimmigrant visa programs (H-1B, H-1B1, H-1C, H-2A).

California Department of Alcoholic Beverage Control

The California Department of Alcoholic Beverage Control’s agents are peace officers under Section 830.2 of the California Penal Code and are empowered to investigate and make arrests for violations of the Business and Professions Code that occur on or about licensed premises. Agents are further empowered to enforce any penal provisions of the law in the state. Licensees who violate state laws or local ordinances are subject to disciplinary action and may have their licenses suspended or revoked. These licensees are entitled to a hearing before an Administrative Law Judge and an appellate process to the State Supreme Court.

Internal Revenue Service

The Internal Revenue Service's (IRS) mission is to provide America’s taxpayers top quality service by helping them understand and meet their tax responsibilities and enforce the law with integrity and fairness to all.

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