Three key leaders in the enforcement division of the U.S. Securities & Exchange Commission’s Fort Worth Regional Office, including its second highest ranking lawyer, are leaving the federal agency to become the general counsel and deputies general counsel of a fast-growing Dallas financial services company, The Texas Lawbook has learned.
SEC Associate Regional Director Jessica Magee, senior trial counsel Timothy Evans and senior counsel Nikolay Vydashenko are joining the Beneficient Company Group, an alternative asset management firm led by Dallas financial titans Brad Heppner, Richard Fisher, Tom Hicks, Bruce Schnitzer and Sheldon Stein.
“A year ago, we made the decision to build an in-house corporate legal team and I’ve known Jessica from 10 or 12 years ago when she worked with my company on matters when she was a lawyer at Thompson & Knight,” Heppener said in an exclusive interview with The Texas Lawbook.
“We founded the company in 2013 with $150 million in capital and used Thompson & Knight as our primary law firm,” Heppner said. “Now, we are 10 times that and we have eight outside law firms handling various matters. We have one regulated operation now and we have three more businesses that we expected to become regulated in the near future.
“Adding Jessica and this team is a homerun for us,” he said.
The loss of the three senior SEC leaders, which is expected to be made public later this week, will leave a huge void in the federal agency’s regional operations and could impact several high-profile prosecutions and investigations, including active enforcement actions against fraudulent cryptocurrency companies and the agency’s probe into Texas Attorney General Ken Paxton, according to multiple lawyers with deep knowledge of the SEC’s operations.
“There’s no other way of slicing it, these are three big losses for the office,” says former SEC Regional Director David Woodcock, who is now a partner at Jones Day in Dallas. “These are three really good lawyers and leaders.”
SEC Regional Director Shamoil Shipchandler agreed that the departure of Magee, Evans and Vydashenko are a significant loss to the Fort Worth office, but he said he understands that the job offers from Beneficient, which is known as BEN, were too good of a career opportunity to pass up.
Shipchandler promoted Magee six months ago to associate regional director of enforcement, which is the second highest-ranking position in the SEC’s Fort Worth office.
“Jessica has been an invaluable member of the SEC’s Fort Worth family for many years and has served with distinction in every part of the enforcement program,” Shipchandler told The Texas Lawbook in an interview Saturday. “We will miss her leadership, judgment and, above all, her innovative spirit.”
Magee has handled many high-profile securities enforcement actions. She was the lead SEC lawyer against Life Partners Holdings and its executives in an alleged death bonds trading scheme.
Lawyers also say that Magee was the driving force behind the SEC’s securities fraud case against Texas Attorney General Ken Paxton, which, contrary to popular belief, is not yet over. Magee, who will have the title of general counsel at BEN, graduated summa cum laude with Bachelor of Arts degree from Texas State University. She earned her law degree cum laude from Southern Methodist University’s Dedman School of Law in 2002 and then worked as a litigation associate at Thompson & Knight in Dallas for more than seven years.
In March 2010, she joined the SEC, where she received a number of awards for her work, including the SEC’s Ferdinand Pecora Award in 2014 and Arthur F. Mathews Award in 2015.
Magee worked on several cases with Evans, who is joining her in the move to BEN. The pair led the litigation against Paxton and the SEC listed them as two top lawyers in a cryptocurrency case filed last week again Arise Bank and its cofounders.
A 2008 graduate of the University of Arkansas School of Law, Evans also worked as a lawyer in the TK litigation group for four years. He joined the SEC in 2012 and he serves as an adjunct professor at the Texas A&M School of Law. Evans’ undergraduate degree is in economics and accounting and he worked as an accountant for three years before going to law school.
Vydashenko graduated from the University of Texas School of Law in 2007 and was an associate at Vinson & Elkins in Dallas for five years. He joined the SEC in 2012, where he has worked in its asset management unit.
Evans and Vydasheno will be deputy GCs at BEN.
“Tim and Nikolay have each distinguished themselves in so many ways,” Shipchandler said. “From investigating some of the commission’s most complex cases to litigating in the most challenging matters, their experienced counsel was something that we counted on for many years.”
Vinson & Elkins securities litigation partner John Wander agrees.
“It’s a real loss for the office,” Wander says “I think it’s hard to articulate and press a clear enforcement agenda in the current political environment, and that only gets harder when the office loses two directors of enforcement in short order and is under budget constraints on new hires.”
Magee, Evans and Vydashenko are the latest in a string of SEC officials to leave the agency to join corporate in-house legal departments. Former Associate Director David Peavler left the SEC last May to become the general counsel of Irving-based HD Vest Financial. Former SEC Assistant Director Joann Harris left in 2015 to become the head of corporate compliance at TPG Capital. And former SEC Assistant Director Michael King left to join the legal department at Gerson Lehman Group.