Tracking the key areas of concern to SEC enforcement can be beneficial for issuers, investment advisers and others that may be subject to scrutiny by the Commission. For example, identifying key areas of focus by determining...more
Climate change and ESG are topics that have been repeatedly addressed by regulators around the world. The Securities and Futures Commission of Hong Kong and the Monetary Authority of Singapore, for example, have repeatedly...more
The Public Company Accounting Oversight Board published a proposed rule designed to create a framework for determinations to be made under the Holding Foreign Companies Accountable Act passed last year (HFCAA). That Act...more
5/19/2021
/ Audits ,
China ,
Corporate Governance ,
Delisting ,
Foreign Affiliates ,
Foreign Corporations ,
Memorandum of Understanding ,
PCAOB ,
Proposed Rules ,
Sarbanes-Oxley ,
Securities and Exchange Commission (SEC)
Money laundering compliance is a critical area for banks, broker-dealers and others in the financial world. The importance of this area was recently highlighted by the passage of the Corporate Transparency Act or CTA to...more
Climate is a topic that has gone from largely ignored to most talked about by the Commission. Recently, for example, the SEC hired a climate expert to serve on the senior staff....more
The Division of Examinations plans to continue prioritizing traditional areas while improving their overall approach, building on past work and interactions with investors and those in the industry, according to the 2021 Exam...more
3/15/2021
/ Anti-Money Laundering ,
Customer Due Diligence (CDD) ,
Data Security ,
ETFs ,
FinTech ,
Investment Funds ,
Libor ,
Registered Investment Advisors ,
Retail Investors ,
SEC Examination Priorities ,
Securities and Exchange Commission (SEC) ,
Suspicious Activity Reports (SARs)
Environmental issues; climate change; and environmental, social and governance issues or ESG. These issues are all the talk, at least since the Biden administration came to Washington and took over....more
Nasdaq filed a proposal with the Securities and Exchange Commission on December 1, 2020 to modify its listing standards to embrace diversity. Specifically, the exchange proposed to require companies listed on Nasdaq Global...more
Climate change is an often talked about issue. Some firmly believe in it; others do not. Regardless of your view, there is a significant quantum of information available on the subject....more
2/24/2021
/ CFTC ,
Climate Change ,
Disclosure Requirements ,
Environmental Policies ,
Financial Reporting ,
Global Marketplace ,
Hong Kong ,
IFRS ,
IOSCO ,
New Zealand ,
Publicly Accessible Data ,
Securities and Exchange Commission (SEC) ,
UK
Climate change, global warming and similar subjects are the daily grist of the news. The Washington Post reported recently, for example, that huge quantities of ice are melting at an alarming rate....more
2/3/2021
/ Biden Administration ,
CFTC ,
Climate Change ,
Corporate Governance ,
Disclosure Requirements ,
Environmental Social & Governance (ESG) ,
MD&A Statements ,
Popular ,
Publicly-Traded Companies ,
Regulation S-K ,
Securities and Exchange Commission (SEC)
The question of what constitutes insider trading has been litigated for decades. Many thought that a series of Supreme Court cases such as Dirks v. SEC, 462 U.S. 646 (1983) and its progeny had largely resolved the question...more
1/27/2021
/ Centers for Medicare & Medicaid Services (CMS) ,
Criminal Prosecution ,
Dirks v SEC ,
Fraud ,
Insider Trading ,
Intangible Property ,
Material Nonpublic Information ,
Rule 10(b) ,
Sarbanes-Oxley ,
Securities and Exchange Commission (SEC) ,
Securities Exchange Act ,
Securities Fraud ,
Wire Fraud
The fourth quarter of calendar year 2020 continued trends evidenced in the third quarter of the year, although far fewer cases were initiated. There were actions brought in a number of key areas such as offering fraud cases,...more
The Commission periodically has filed enforcement actions against broker-dealers for failing to file SARs - suspicious activity reports - typically centered on a failure to file reports regarding microcap issuers. Those...more
12/18/2020
/ Administrative Procedure Act ,
Anti-Money Laundering ,
Bank Secrecy Act ,
Broker-Dealer ,
Chevron Deference ,
Compliance ,
Corporate Governance ,
Financial Institutions ,
FinCEN ,
Notice and Comment ,
Patriot Act ,
Reporting Requirements ,
Securities and Exchange Commission (SEC) ,
Suspicious Activity Reports (SARs) ,
U.S. Treasury
Compliance is a key issue for all firms. Many companies use the U.S. sentencing guidelines as a starting point. In other instances, regulators craft a starting point with rules that direct the creation of programs....more
The Commission’s Office of Compliance Inspections and Examinations or OCIE issued a Risk Alert on November 9, 2020 centered on questions keyed to supervision and compliance in the context of multiple branch advisories. The...more
The Division of Enforcement published its 2020 Annual Report on November 2, 2020 (here). The Report contains the now familiar sections: A Message from the Director keyed to highlights; a review and discussion of key areas of...more
11/9/2020
/ Annual Reports ,
Corporate Counsel ,
Disclosure Requirements ,
Enforcement Actions ,
Enforcement Statistics ,
Financial Fraud ,
Foreign Corrupt Practices Act (FCPA) ,
Investors ,
Securities and Exchange Commission (SEC) ,
Securities Tokens ,
Unregistered Securities
The Commission frequently increases the rate at enforcement actions are filed in advance of the September 30th fiscal year end. That fiscal year end is followed by Congressional budget hearings where statistics are at least...more
The U.S. Securities and Exchange Commission’s (“Commission” or “SEC”) whistleblower program has, by all accounts, been a huge success. Added to the Securities Exchange Act of 1934 (“Exchange Act”) as Section 21F by the...more
The ruling: The Supreme Court significantly limited the SEC’s ability to seek disgorgement. Specifically, the Court held that any award must be limited to the wrongdoer’s “net profits” and be awarded “for victims.”...more
6/25/2020
/ 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)
Any firm marketing COVID related services, or that has applied for or obtained benefits under recently enacted legislation tied to the virus, should carefully examine their activities in this area in view of the regulatory...more
Regulation Best Interest, born of a long debate over the appropriate standard to govern recommendations by broker-dealers, is now the subject of an OCIE Risk Alert. The staff is preparing to launch its first inspection for...more
Inspections for compliance with Form CRS and its rules will begin after the June 30, 2020 filing date, according to an OCIE Risk Alert dated April 7, 2020. The Alert identifies key areas the staff will be examining regarding...more
The first quarter of 2020 ended with the markets plummeting to new lows and much of the country shuttered in an effort to avoid transmitting COVID-19. SEC Enforcement finished the quarter by not filing any new cases in the...more
On March 13, 2020, the Securities and Exchange Commission (SEC), indicating that it is closely monitoring the impact of coronavirus on investors, funds and advisers, announced regulatory relief for funds and investment...more
3/16/2020
/ Annual Meeting ,
Coronavirus/COVID-19 ,
Corporate Governance ,
Disclosure Requirements ,
Filing Deadlines ,
Filing Requirements ,
Investment Adviser ,
Investment Company Act of 1940 ,
Investment Funds ,
Registered Investment Companies (RICs) ,
Relief Measures ,
Securities and Exchange Commission (SEC) ,
Virtual Meetings
Liu v. SEC, No. 18-15-1, argued before the Court last week, is potentially one of the most important cases to be heard by the Supreme Court on SEC Enforcement. The question under consideration is whether the Securities and...more
3/12/2020
/ 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