Key Points The United States Securities and Exchange Commission (SEC) is able to make requests of U.K. firms (including U.K. branches of non-U.K. firms) to provide books and records and other documents of SEC regulated...more
1/26/2021
/ Books & Records ,
Document Requests ,
Financial Conduct Authority (FCA) ,
General Data Protection Regulation (GDPR) ,
Information Commissioner's Office (ICO) ,
IOSCO ,
Personal Data ,
Public Interest ,
Securities and Exchange Commission (SEC) ,
Securities Regulation ,
UK Brexit ,
UK GDPR
- The OCIE of the SEC highlights that responses to COVID-19 present important regulatory and compliance issues for SEC registrants, including “heightened risks of misconduct” tied to recent market volatility.
- The Risk...more
8/21/2020
/ Asset Management ,
Broker-Dealer ,
Business Continuity Plans ,
Business Operations ,
Compliance ,
Conflicts of Interest ,
Coronavirus/COVID-19 ,
Cybersecurity ,
Data Protection ,
Fees ,
Financial Transactions ,
Investment Adviser ,
Investment Fraud ,
Investment Management ,
Investors ,
OCIE ,
Personally Identifiable Information ,
Policies and Procedures ,
Popular ,
Remote Working ,
Risk Alert ,
Securities and Exchange Commission (SEC) ,
Supervision
- In the age of broad corporate teleworking brought on by COVID-19, OCIE of the SEC has observed during recent examinations that investment advisers, broker-dealers and investment companies are subject to an increased threat...more
7/16/2020
/ Broker-Dealer ,
Cyber Attacks ,
Cybersecurity ,
Data Breach ,
Financial Services Industry ,
Homeland Security Cybersecurity & Infrastructure Security Agency (CISA) ,
Incident Response Plans ,
Investment Management ,
Malware ,
OCIE ,
Popular ,
Ransomware ,
Risk Alert ,
Securities and Exchange Commission (SEC)
- On June 23, 2020, the SEC and OCIE issued its latest Risk Alert describing common deficiencies it has observed in recent examinations of registered investment advisers that manage private equity funds or hedge funds.
-...more
7/6/2020
/ Conflicts of Interest ,
Enforcement Actions ,
Fees ,
Hedge Funds ,
Investment Management ,
Non-Public Information ,
OCIE ,
Policies and Procedures ,
Private Equity Funds ,
Registered Investment Advisors ,
Risk Alert ,
Securities and Exchange Commission (SEC)
- In Liu v. SEC, No. 18-1501, the Supreme Court upheld the SEC’s ability to obtain disgorgement as a form of equitable relief in civil actions in federal court, pursuant to 15 U.S.C. § 78u(d)(5).
- However, the Court...more
6/30/2020
/ 15 U.S.C. § 78u(d)(5) ,
Administrative Authority ,
Business Expenses ,
Calculation of Damages ,
Corporate Misconduct ,
Disgorgement ,
Enforcement Actions ,
Equitable Relief ,
Kokesh v SEC ,
Lack of Authority ,
Liu v Securities and Exchange Commission ,
Net Profits ,
Remedies ,
SCOTUS ,
Securities and Exchange Commission (SEC)
- Market participants should review and assess their compliance procedures to prevent and detect insider trading risks associated with COVID-19.
- Companies should increase their vigilance regarding cybersecurity threats...more
4/1/2020
/ CFTC ,
Coronavirus/COVID-19 ,
Cybersecurity ,
Department of Justice (DOJ) ,
Enforcement Actions ,
Financial Crimes ,
Insider Trading ,
Investors ,
Phishing Scams ,
Pump and Dump ,
Securities and Exchange Commission (SEC) ,
Securities Fraud ,
U.S. Treasury ,
Wire Fraud
Key Points:
The 2nd Circuit has issued a landmark decision for insider trading enforcement that will make it significantly easier for the government to prosecute insider trading in criminal cases.
The decision may also...more
• The Supreme Court will review whether the SEC has the authority to obtain disgorgement in actions to enforce the federal securities laws.
• Since the Supreme Court’s decision in Kokesh v. SEC, 137 S. Ct. 1635 (2017),...more
11/12/2019
/ Administrative Authority ,
Certiorari ,
Disgorgement ,
Enforcement Actions ,
Equitable Relief ,
Kokesh v SEC ,
Lack of Authority ,
Liu v Securities and Exchange Commission ,
Penalties ,
Petition for Writ of Certiorari ,
Regulatory Agencies ,
SCOTUS ,
Securities and Exchange Commission (SEC) ,
Securities Violations ,
Split of Authority ,
Statute of Limitations
• On May 23, 2019, the Securities and Exchange Commission’s (SEC) Office of Compliance Inspections and Examinations (OCIE) issued a Risk Alert describing its observations in past examinations of weaknesses and best practices...more
5/29/2019
/ Broker-Dealer ,
Cloud Storage ,
Customer Information ,
Cyber Threats ,
Cybersecurity ,
Data Protection ,
Data Security ,
Data Storage Providers ,
Identity Theft ,
Identity Theft Red Flags Rule ,
Investment Adviser ,
OCIE ,
Policies and Procedures ,
Regulation S-ID ,
Regulation S-P ,
Regulatory Requirements ,
Risk Alert ,
Safeguards Rule ,
Securities and Exchange Commission (SEC) ,
Third-Party Service Provider ,
Vendors
• The SEC released a Risk Alert summarizing key areas in which it continues to see compliance deficiencies related to Regulation S-P, the primary SEC rule regarding privacy notices and safeguard policies of investment...more
4/29/2019
/ Broker-Dealer ,
Customer Information ,
Cybersecurity ,
Data Breach ,
Data Privacy ,
Data Security ,
Employee Training ,
Incident Response Plans ,
Investment Adviser ,
Notice Requirements ,
OCIE ,
Opt-Outs ,
Personally Identifiable Information ,
Policies and Procedures ,
Popular ,
Privacy Policy ,
Regulation S-P ,
Risk Alert ,
Safeguards Rule ,
Securities and Exchange Commission (SEC) ,
Vendors
• The United States Supreme Court held that a disseminator of a false statement with intent to defraud can be held liable under subsections (a) and (c) of Rule 10b-5, §10(b) of the Exchange Act and §17(a)(1) of the Securities...more
4/2/2019
/ Appeals ,
Enforcement Actions ,
False Statements ,
Fines ,
Intent to Defraud ,
Investment Banks ,
Lorenzo v SEC ,
Material Dissemination ,
Misleading Statements ,
Reaffirmation ,
Rule 10b-5 ,
SCOTUS ,
Securities and Exchange Commission (SEC) ,
Securities Violations ,
Suspensions
• On December 14, the SEC’s OCIE issued a Risk Alert summarizing the findings of its limited-scope examination initiative relating to electronic messaging.
• Noting a “pervasive use” of electronic messaging by adviser...more
12/18/2018
/ Best Practices ,
Books & Records ,
Bring Your Own Device (BYOD) ,
Cybersecurity ,
Electronic Communications ,
Email Policies ,
Employee Training ,
Investment Adviser ,
Investment Advisers Act of 1940 ,
New Guidance ,
OCIE ,
Policies and Procedures ,
Recordkeeping Requirements ,
Risk Alert ,
Risk Mitigation ,
Securities and Exchange Commission (SEC) ,
Text Messages
• The SEC issued guidance in the form of a rare “21(a) report” this week after investigating a series of email frauds impacting 9 unnamed companies.
• These email-based frauds, referred to as “CEO scams” or “vendor scams,”...more
10/19/2018
/ Accounting Controls ,
Business E-Mail Compromise (BEC) ,
CEOs ,
Corporate Finance ,
Cyber Crimes ,
Cybersecurity ,
Data Breach ,
Email ,
Enforcement Actions ,
Internal Controls ,
New Guidance ,
Policies and Procedures ,
Popular ,
Publicly-Traded Companies ,
Scams ,
Securities and Exchange Commission (SEC) ,
Securities Exchange Act ,
Spoofing ,
Wire Fraud
• The U.S. Securities and Exchange Commission (SEC) staff made official statements regarding when a token may or may no longer be a security
• The SEC continued to bring actions related to cryptocurrency offerings against...more
9/24/2018
/ Anti-Money Laundering ,
Banking Sector ,
Bitcoin ,
Broker-Dealer ,
CFTC ,
Commodities ,
Counter-Terrorist ,
Cryptocurrency ,
Customer Due Diligence (CDD) ,
Digital Currency ,
Disclosure Requirements ,
Enforcement Actions ,
Exchange-Traded Products ,
FATF ,
Financial Institutions ,
FinTech ,
Income Taxes ,
Initial Coin Offering (ICOs) ,
Investment Adviser ,
Investment Company Act of 1940 ,
IRS ,
Jurisdiction ,
Motion to Dismiss ,
National Futures Association ,
Popular ,
Reporting Requirements ,
Securities and Exchange Commission (SEC) ,
Securities Fraud ,
Token Sales ,
Trading Platforms ,
U.S. Treasury ,
Unregistered Securities ,
Virtual Currency ,
Websites
As the U.S. Securities and Exchange Commission (SEC) stated previously, it is continuing to scrutinize and commence enforcement actions against companies, advisors and investors involved in the offering of cryptocurrencies...more
9/19/2018
/ Bitcoin ,
Blockchain ,
Broker-Dealer ,
CFTC ,
Cryptocurrency ,
Department of Justice (DOJ) ,
Digital Currency ,
Distributed Ledger Technology (DLT) ,
Enforcement Actions ,
False Statements ,
Financial Industry Regulatory Authority (FINRA) ,
Financial Services Industry ,
Fraud and Abuse ,
Hedge Funds ,
Initial Coin Offering (ICOs) ,
Investors ,
Misleading Statements ,
Publicly-Traded Companies ,
Registration Statement ,
Securities Act ,
Securities and Exchange Commission (SEC) ,
Securities Fraud ,
Securities Litigation ,
Shareholder Litigation ,
Token Sales ,
Virtual Currency
• SEC ALJs are “Officers of the United States” within the meaning of the Appointments Clause and therefore must be appointed directly by the SEC. The Court’s decision may permit litigants in prior and pending administrative...more
6/26/2018
/ Administrative Agencies ,
Administrative Law Judge (ALJ) ,
Administrative Proceedings ,
Appeals ,
Appointments Clause ,
Constitutional Challenges ,
Enforcement Actions ,
Final Written Decisions ,
Lucia v SEC ,
Officers of the United States ,
Remand ,
Reversal ,
SCOTUS ,
Securities and Exchange Commission (SEC) ,
Securities Violations ,
Special Trial Judges (STJs)
On Thursday, U.S. Securities and Exchange Commission (SEC) Director of Corporate Finance William Hinman provided some long-desired clarity on the SEC’s approach to cryptocurrency regulation, announcing during Yahoo Finance’s...more
6/18/2018
/ Bitcoin ,
CFTC ,
Cryptocurrency ,
Digital Assets ,
Digital Currency ,
Ether ,
Initial Coin Offering (ICOs) ,
Investors ,
New Guidance ,
Securities and Exchange Commission (SEC) ,
Securities Transactions ,
Token Sales
• A New York federal judge held that virtual currencies are commodities within the meaning of the Commodity Exchange Act.
• This marks the first court decision to assess and to adopt the CFTC’s position that virtual...more
3/14/2018
/ CFTC ,
Commodities ,
Commodity Exchange Act (CEA) ,
Consumer Protection Act ,
Cryptocurrency ,
Currency Manipulation ,
Enforcement Actions ,
Fraud ,
Jurisdiction ,
Preliminary Injunctions ,
Securities and Exchange Commission (SEC) ,
Virtual Currency
• Whistleblower protections for securities violations in Dodd-Frank extend to only employees who report violations to the SEC.
• Applying the plain language of the statute’s definition of “whistleblower,” limiting the...more
2/26/2018
/ Anti-Retaliation Provisions ,
Digital Realty Trust Inc v Somers ,
Dodd-Frank ,
Internal Reporting ,
Reporting Requirements ,
Retaliation ,
Sarbanes-Oxley ,
SCOTUS ,
Securities and Exchange Commission (SEC) ,
Securities Violations ,
Whistleblower Protection Policies ,
Whistleblowers
• On January 12, 2018, the Supreme Court granted certiorari in Lucia v. SEC, to resolve a circuit split over whether the SEC’s administrative law judges serve in violation of the Appointments Clause of the Constitution.
•...more
This week, the Supreme Court in Kokesh v. SEC unanimously held that the Securities and Exchange Commission’s (SEC) equitable disgorgement remedy is subject to a five-year statute of limitations because it is a “penalty”...more