The SEC Speaks 2018: the US Securities and Exchange Commission’s current priorities and conference overview

2018 ◽  
Vol 19 (3) ◽  
pp. 1-4
Author(s):  
Gerald J. Russelo ◽  
Stephen L. Cohen ◽  
Jose F. Sanchez
Keyword(s):  
Financial Services ◽  
Design Methodology ◽  
Regulatory Compliance ◽  
Securities And Exchange Commission ◽  
Financial Industry ◽  
Content Type ◽  
Market Participants ◽  
The Us ◽  
Past Experiences ◽  
Insight Into

Purpose This paper aims to highlight certain comments made by US Securities and Exchange Commission (SEC) officials, which may provide insight into compliance and enforcement issues that may be important for market participants, including broker-dealers, investment advisors and reporting companies, in the future. Design/methodology/approach This paper explains comments made by SEC officials and highlights potential regulatory issues based on past experiences of attorneys within the firm, past comments made by the SEC and Financial Industry Regulatory Authority and past regulatory exam results. Findings This paper summarizes remarks from the recent SEC Speaks 2018 Conference conducted by SEC officials related to the Commission’s regulatory and enforcement priorities. Issuers, brokers, advisors and other financial organizations should familiarize themselves with the themes and guidance discussed at the Conference to prepare for regulatory compliance challenges in the upcoming year. Originality/value Practical guidance from experienced securities and financial services lawyers.

FINRA revises and restructures registration and exam requirements

2018 ◽  
Vol 19 (1) ◽  
pp. 42-49
Author(s):  
Edward J. Johnsen ◽  
John H. Grady
Keyword(s):  
Financial Services ◽  
Regulatory Authority ◽  
Design Methodology ◽  
Securities And Exchange Commission ◽  
Financial Industry ◽  
Content Type ◽  
The Us ◽  
Securities Industry ◽  
Practical Guidance ◽  
Limited Period

Purpose To explain a new set of rules, detailed in FINRA Regulatory Notice 17-30, proposed by the Financial Industry Regulatory Authority (FINRA) and approved by the US Securities and Exchange Commission (SEC), that revise and streamline the number and types of proficiency exams broker-dealer personnel must take in order to become registered, as well as the categories of registration. Design/methodology/approach Discusses the background, including FINRA’s consolidation of National Association of Securities Dealers (NASD) rules; the new registration regime; conditions for waivers; criteria for “permissive” registration; firms’ requirement to designate “Principal Financial Officers” and “Principal Operations Officers”; new categories of principal registration; FINRA’s elimination of certain registration categories; research analyst, research principal and supervisory analyst exam requirements; the ability of a registered representative to function as a principal for a limited period; the prohibition of unregistered persons to accept orders from customers; and the Securities Industry Essentials (SIE) Examination Content Outline. Findings The new structure is intended to bring greater consistency and uniformity to the qualification process. Among other changes, it eliminates several registration categories that either have become outdated or have limited utility, permits persons not yet associated with a broker-dealer or employed in the securities industry to take a preliminary registration exam prior to entering the securities industry, and makes other changes intended to modernize the registration and examination regime for broker-dealer personnel. Originality/value Practical guidance from lawyers with broad stock brokerage, investment management and related financial services experience.

SEC framework and no-action letter provide guidance on analyzing whether a digital asset is a security

2019 ◽  
Vol 20 (4) ◽  
pp. 68-71
Author(s):  
Kenneth J. Berman ◽  
Morgan J. Hayes ◽  
Matthew E. Kaplan ◽  
Byungkwon Lim ◽  
Gary E. Murphy ◽  
...  
Keyword(s):  
Financial Services ◽  
Design Methodology ◽  
Securities And Exchange Commission ◽  
Investment Funds ◽  
Content Type ◽  
Market Participants ◽  
Securities Investment Funds ◽  
The Us ◽  
Digital Asset ◽  
Digital Assets

Purpose To analyze and draw conclusions from the “Framework for ‘Investment Contract’ Analysis of Digital Assets” (the “Framework”), released by the US Securities and Exchange Commission (the “SEC”) on April 3, 2019, and the SEC’s corresponding no-action letter to TurnKey Jet, Inc. (“TKJ”), which is the SEC’s first no-action letter publicly agreeing with the view that the digital asset described therein is not a security. Design/Methodology/Approach Explains how the Framework assists market participants in analyzing whether a digital asset is a security, by applying the Howey factors for identifying an investment contract. Discusses the SEC’s TKJ Letter, highlighting the factors the SEC emphasized in its analysis of the Framework. Findings While largely reiterating prior guidance, the Framework provides a helpful overview of the SEC’s views on when a digital asset is a security and how to properly analyze the prongs of Howey with respect to digital assets. The Framework also leaves certain important questions unanswered, including, for example, whether digital assets distributed by means of a so-called “Airdrop” are securities under the Framework, and the extent to which the Framework is meant to interact with digital assets that were issued or otherwise operate on platforms that are primarily overseas. Originality/Value Expert guidance from lawyers with broad experience in financial services, securities, investment funds, derivatives, and digital assets regulation and compliance.

A review of the SEC Participating Affiliate No-Action Letters’ relief from Investment Advisers Act of 1940 registration for foreign investment advisers

2017 ◽  
Vol 18 (4) ◽  
pp. 22-28 ◽  
Author(s):  
Wendy E. Cohen ◽  
David Y. Dickstein ◽  
Christian B. Hennion ◽  
Richard D. Marshall ◽  
Allison C. Yacker ◽  
...  
Keyword(s):  
Foreign Investment ◽  
Financial Services ◽  
Design Methodology ◽  
Securities And Exchange Commission ◽  
Content Type ◽  
The Us ◽  
Information Update ◽  
Practical Guidance ◽  
Investment Advisers

Purpose To explain the US Securities and Exchange Commission (the “SEC”) staff’s (the “Staff”) participating affiliate exemption from investment adviser registration for foreign advisers set forth in a line of Staff no-action letters issued between 1992 and 2005 (the “Participating Affiliate Letters”) and to discuss recent guidance issued by the Staff in an information update published in March 2017 (the “Information Update”) with respect to complying with requirements of the Participating Affiliate Letters. Design/methodology/approach Reviews the development of the Staff’s approach regarding the non-registration of foreign advisers that rely on the Participating Affiliate Letters from prior to the issuance of those letters through the Information Update and sets forth recommendations for registered investment advisers and their participating affiliates. Findings While there are arguments that the Information Update goes beyond restating established standards and does not clearly explain whether submission of all listed documentation is required, the Information Update will likely standardize the information submitted to the SEC. Originality/value Practical guidance for advisers relying on the Participating Affiliate Letters from experienced securities and financial services lawyers.

SEC’s disclosure effectiveness initiative reshapes MD&A disclosure requirements

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Richard J. Parrino
Keyword(s):  
Design Methodology ◽  
Securities And Exchange Commission ◽  
Financial Information ◽  
Content Type ◽  
Market Participants ◽  
Financial Condition ◽  
Disclosure Requirements ◽  
Depth Analysis ◽  
The Us ◽  
Financial Disclosures

Purpose This article examines rule amendments issued by the US Securities and Exchange Commission in November 2020, as part of the SEC’s ongoing “disclosure effectiveness initiative”, that revise in significant respects the requirements for financial disclosures presented in SEC filings as Management’s Discussion and Analysis of Financial Condition and Results of Operations. Design/methodology/approach This article provides an in-depth analysis of the rule amendments in the context of contrasting perspectives expressed by the SEC, individual SEC Commissioners who dissented from adoption of the amendments, and market participants regarding the merits of the SEC’s movement away from prescriptive disclosure requirements towards a more principles-based approach to disclosure. Findings Although the SEC’s rules have long reflected a mix of principles-based and prescriptive disclosure elements, the principles-based emphasis in this latest stage of the SEC’s disclosure modernization project accords the managements of filing companies greater latitude to determine whether financial information is material to investors and how such information should be presented. Originality/value This article provides expert guidance on a major new SEC disclosure development from an experienced securities lawyer.

Heightened supervision of branch offices

2015 ◽  
Vol 16 (2) ◽  
pp. 18-21
Author(s):  
Daniel A. Nathan ◽  
Lauren Navarro ◽  
Kevin Matta
Keyword(s):  
Regulatory Authority ◽  
Design Methodology ◽  
Securities And Exchange Commission ◽  
Financial Industry ◽  
Content Type ◽  
National Examination ◽  
Policies And Procedures ◽  
The Us ◽  
Branch Office ◽  
Practical Implications

Purpose – To explain expectations of the US Securities and Exchange Commission (SEC) and Financial Industry Regulatory Authority (FINRA) as to what constitutes successful branch inspection programs for broker-dealers. Design/methodology/approach – Summarizes FINRA’s rules requiring firms to implement branch inspection programs; examines the SEC’s and FINRA’s joint 2011 National Examination Risk Alert, which expanded upon FINRA’s rules, requiring firms to conduct risk-based analyses on each branch office to determine the appropriate frequency, intensity, and focus of inspections; discusses FINRA’s expectation that firms examine their registered representatives’ financial circumstances to reduce the risk of fraud; explains how FINRA’s Comprehensive Automated Risk Data System may impact branch inspections; and recommends several sources that firms should review when implementing a successful branch inspection program. Findings – Regulators have heightened their expectations as to what constitutes successful branch inspection programs for broker-dealers. Practical implications – To avoid regulatory intervention and discipline, firms should continue to review their policies and procedures to ensure that their programs are sufficiently comprehensive. Originality/value – This article will encourage firms with branch offices to review their branch inspection programs, and assist those firms in implementing sufficiently comprehensive policies and procedures.

US Supreme Court clarifies liability standard under Section 11 of the Securities Act of 1933 for statements of opinion in registration statements

2015 ◽  
Vol 16 (3) ◽  
pp. 37-42
Author(s):  
Richard Parrino ◽  
Douglas Schwab ◽  
David Wertheimer
Keyword(s):  
Supreme Court ◽  
Financial Services ◽  
Design Methodology ◽  
Pension Fund ◽  
Securities And Exchange Commission ◽  
Federal Courts ◽  
Content Type ◽  
The Supreme Court ◽  
The Us ◽  
Us Supreme Court

Purpose – The purpose of this article is to examine the US Supreme Court’s much anticipated decision in Omnicare, Inc. v. Laborers Dist. Council Const. Indus. Pension Fund. In this 2015 case, the Supreme Court announced important principles for interpreting the application of the two bases for liability under Section 11 of the Securities Act of 1933 to statements of opinion expressed in registration statements filed with the Securities and Exchange Commission in connection with public securities offerings. Design/methodology/approach – The article examines the Supreme Court’s articulation of the standards federal courts must apply under Section 11 to determine if opinion statements were untrue statements of a material fact or misleading because they omitted material facts necessary to make the statements of opinion not misleading. The paper identifies a number of the complexities involved in the Supreme Court’s approach and emphasizes the nuanced assessment of the facts surrounding opinion statements courts will be required to undertake by Omnicare. Findings – The Omnicare decision has significant implications for the litigation of Section 11 claims challenging statements of opinion and for the preparation of registration statement disclosures. The Omnicare decision dramatically alters the standards for reviewing Section 11 claims premised on opinions long applied in a number of US federal appellate circuits. The decision is likely to result in more Section 11 claims based on supposedly misleading opinion statements, and potentially in a greater number of Section 11 claims that survive at least an initial motion to dismiss. Omnicare highlights the importance of including in registration statement disclosures meaningful cautionary statements identifying important facts that could cause actual outcomes to differ materially from views expressed in an opinion. Originality/value – Expert guidance from experienced financial services lawyers.

U.S. Securities and Exchange Commission (SEC) Staff issues no-action relief to facilitate implementation of Markets in Financial Instruments Directive II (MiFID II) research provisions

2018 ◽  
Vol 19 (1) ◽  
pp. 53-57
Author(s):  
Paul J. Delligatti ◽  
William P. Lane
Keyword(s):  
Design Methodology ◽  
Securities And Exchange Commission ◽  
Background Information ◽  
Financial Instruments ◽  
Investment Management ◽  
Financial Industry ◽  
Content Type ◽  
Market Participants ◽  
Practical Guidance

Purpose The purpose of this paper is to summarize and discuss the implications of three related U.S. Securities and Exchange Commission (SEC) no-action letters dated October 26, 2017 that seek to address the provisions of MiFID II related to “inducements”. Design/methodology/approach Provides background information regarding MiFID II and summarizes each of the three SEC Staff no-action letters: the SIFMA letter, the ICI letter and the AMG letter. Findings The no-action letters provide market participants with increased clarity as to how certain aspects of their business activities, in particular the “bundling” or “unbundling” of payments for research and execution, can comply with potentially competing systems of regulations. Originality/value Practical guidance from experienced financial industry and investment management lawyers.

SEC publishes important guidance on the Custody Rule, participating affiliate arrangements, robo-advisers, Form PF and certain compliance topics

2017 ◽  
Vol 18 (3) ◽  
pp. 34-40
Author(s):  
Joyce E. Larson ◽  
Kara J. Brown ◽  
Ivet A. Bell
Keyword(s):  
Institutional Investors ◽  
Financial Services ◽  
Design Methodology ◽  
Securities And Exchange Commission ◽  
Content Type ◽  
The Us ◽  
Practical Guidance ◽  
Investment Advisers ◽  
Regulatory Filing

Purpose To highlight guidance issued by the US Securities and Exchange Commission (SEC) for the benefit of investment advisers regarding certain obligations under the Investment Advisers Act of 1940 (Advisers Act) and the rules thereunder. Design/methodology/approach Summarizes recent guidance regarding issues related to several challenging Advisers Act requirements, including inadvertent custody and client account transfers under Advisers Act Rule 206(4)-2, the use of participating affiliate arrangements pursuant to the “Unibanco” no-action letters, unique considerations affecting automated advisers (i.e., “robo-advisers”), the top five most frequently identified compliance topics identified in examinations conducted by the SEC’s Office of Compliance Inspections and Examinations (OCIE), and recent guidance regarding the private fund regulatory filing Form PF. Findings This guidance may assist advisers in preparing for regulatory examinations and questions from institutional investors. While the recent guidance addresses important topics, the guidance also raises some practical questions. Originality/value Practical guidance from experienced securities and financial services lawyers.

SEC charges “ICO Superstore” as unregistered broker-dealer

2019 ◽  
Vol 20 (1) ◽  
pp. 40-43
Author(s):  
John J. Sikora Jr. ◽  
Stephen P. Wink ◽  
Douglas K. Yatter ◽  
Naim Culhaci
Keyword(s):  
Financial Services ◽  
Design Methodology ◽  
Securities And Exchange Commission ◽  
Content Type ◽  
The Us ◽  
Recent Developments ◽  
Practical Guidance ◽  
Securities Laws ◽  
Enforcement Activity

Purpose To analyze the settled order of the US Securities and Exchange Commission (SEC) against TokenLot LLC (TokenLot), which was the SEC’s first action charging a seller of digital tokens as an unregistered broker-dealer. Design/methodology/approach Analyzes the SEC’s order within the context of other recent actions by the SEC on cryptocurrencies and digital tokens and discusses future implications of the order in this area. Findings The SEC’s order against TokenLot as an unregistered broker-dealer was a logical next step in its enforcement activity in the cryptocurrency and digital token space.The order demonstrates that the SEC expects firms in the cryptocurrency space to use the well-established constructs of federal securities laws to evaluate their business activities to ensure those activities are legally compliant. Originality/value Practical guidance from experienced securities and financial services lawyers analyzing recent developments in a nascent area of SEC enforcement.

SEC focuses on initial coin offerings: tokens may be securities under federal securities laws

2018 ◽  
Vol 19 (1) ◽  
pp. 10-14
Author(s):  
Jeremy I. Senderowicz ◽  
K. Susan Grafton ◽  
Timothy Spangler ◽  
Kristopher D. Brown ◽  
Andrew J. Schaffer
Keyword(s):  
Financial Services ◽  
Design Methodology ◽  
Securities And Exchange Commission ◽  
Content Type ◽  
The Us ◽  
Recent Developments ◽  
Securities Laws ◽  
Initial Coin Offerings

Purpose To explain the recent determination by the US Securities and Exchange Commission (SEC) with respect to so-called “token sales” or “initial coin offerings” (ICOs) that some tokens may be securities under federal securities laws and to address other recent actions by the SEC with respect to ICOs. Design/methodology/approach Reviews the SEC’s determination that some tokens issued in an ICO may be securities under federal securities laws as outlined by the SEC’s Division of Enforcement in a “Report of Investigation Pursuant to Section 21(a) of the Securities Exchange Act of 1934: The DAO.” Provides overview of SEC Investor Alert, Investor Bulletin, and recent comments and actions of the Staff regarding investment in ICOs and provides guidance to those interested in participating in an ICO as an investor or issuer. Findings These actions by the SEC make it clear that the SEC is closely monitoring the market for ICOs, and that it wants potential investors and issuers to be aware that it is watching and may take action if it believes the securities laws have been violated. Originality/value Practical overview of recent developments and guidance from experienced securities and financial services lawyers.

Sign in / Sign up

Export Citation Format

Share Document