SEC approves long-anticipated FINRA research rules

2016 ◽  
Vol 17 (1) ◽  
pp. 39-44 ◽  
Author(s):  
Amy Natterson Kroll ◽  
John Ayanian
Keyword(s):  
Design Methodology ◽  
Comprehensive Review ◽  
Content Type ◽  
Research Activities ◽  
Policies And Procedures ◽  
Equity Research ◽  
Practical Guidance ◽  
Research Analysts ◽  
Required Disclosures ◽  
Insight Into

Purpose To analyze the changes to the FINRA equity research rules and evaluate concerns that may be important to and have an impact on equity research activities following the effective date. Design/methodology/approach This article provides an overview of the changes reflected in FINRA Rule 2241 pertaining to equity research analysts and research reports, as well as changes to licensing requirements for equity research analysts. It highlights potential issues for firms and provides some commentary on how these issues should be considered in light of FINRA’s articulated position and assurances FINRA has given to the SEC. Findings This article concludes that firms should anticipate these changes and begin a comprehensive review of research policies and procedures, the personnel who prepare research reports and the scope of their research products so as to be compliant with Rule 2241 from its effective date. Firms should also begin an investigation of technologies used to gather, produce and disseminate research and required disclosures to ensure they meet the new requirements when they are effective. Originality/value This article provides insight into the new FINRA Rule 2241 and practical guidance from experienced securities lawyers.

SEC issues Staff Legal Bulletin after four-year comprehensive review of proxy system

2015 ◽  
Vol 16 (1) ◽  
pp. 63-65
Author(s):  
John E. Sorkin ◽  
Abigail Pickering Bomba ◽  
Steven Epstein ◽  
Jessica Forbes ◽  
Peter S. Golden ◽  
...  
Keyword(s):  
Design Methodology ◽  
Securities And Exchange Commission ◽  
Third Parties ◽  
Comprehensive Review ◽  
Content Type ◽  
Policies And Procedures ◽  
Practical Guidance ◽  
Investment Advisers ◽  
Practical Implications

Purpose – To provide an overview of the guidance for proxy firms and investment advisers included in the Staff Legal Bulletin released this year by the Securities and Exchange Commission (SEC) after its four-year comprehensive review of the proxy system. Design/methodology/approach – Discusses briefly the context in which the SEC’s review was conducted; the general themes of the guidance provided; the most notable aspects of the guidance; and the matters that were expected to be, but were not, addressed by the SEC. Findings – The guidance does not go as far in regulating proxy advisory firms as many had anticipated it would. The key obligations specified in the guidance are imposed on the investment advisers who engage the proxy firms. The responsibilities, policies and procedures mandated do not change the fundamental paradigm that has supported the influence of proxy firms – that is, investment advisers continue to be permitted to fulfill their duty to vote client shares in a “conflict-free manner” by voting based on the recommendations of independent third parties, and continue to be exempted from the rules that generally apply to persons who solicit votes or make proxy recommendations. Practical implications – The SEC staff states in the Bulletin that it expects that proxy firms and investment advisers will conform to the obligations imposed in the Bulletin “promptly, but in any event in advance of [the 2015] proxy season.” Originality/value – Practical guidance from experienced M&A lawyers.

Are your customer accounts in order? – SEC announces sweep of broker-dealers and implementation of the customer protection rule initiative

2017 ◽  
Vol 18 (1) ◽  
pp. 68-74
Author(s):  
Melissa Beck Mitchum ◽  
Bob Xiong
Keyword(s):  
Current Account ◽  
Design Methodology ◽  
Securities And Exchange Commission ◽  
Content Type ◽  
Policies And Procedures ◽  
Practical Guidance ◽  
Reporting Mechanism

Purpose To explain the Customer Protection Rule Initiative announced by the Securities and Exchange Commission (SEC) and offer practical guidance for complying with Rule 15c3-3 under the Securities Exchange Act of 1934. Design/methodology/approach This article discusses Rule 15c3-3 under the Securities Exchange Act of 1934, related interpretative guidance, and the Customer Protection Rule Initiative announced in June 2016 by the SEC. Findings This article concludes that broker-dealers should take advantage of the Customer Protection Rule Initiative’s self-reporting mechanism and use this time to review their current account arrangements with banks, existing internal policies and procedures, and account documentation. Originality/value This article contains valuable information about the SEC’s Customer Protection Rule Initiative and practical compliance guidance from experienced securities lawyers.

The role of augmented reality in robotics

2020 ◽  
Vol 47 (6) ◽  
pp. 789-794
Author(s):  
Robert Bogue
Keyword(s):  
Augmented Reality ◽  
Design Methodology ◽  
Haptic Feedback ◽  
Historical Background ◽  
Content Type ◽  
Virtual Fixtures ◽  
Research Activities ◽  
Insight Into ◽  
Positional Control

Purpose The purpose of this paper is to provide an insight into how augmented reality (AR) technologies are being applied to robotics. Design/methodology/approach Following an introduction and a brief historical background to AR, this first provides examples of AR applications in robot programming. It then gives examples of recent research into AR-based robot teleoperation. Research activities involving the virtual fixtures (VF) technique are then discussed and finally, brief conclusions are drawn. Findings Because AR concepts were first investigated in the 1990s, applications involving robotics have been widely studied. Programming with the aid of AR devices, such as the HoloLens headset, can be simplified and AR methods, including the VF technique, can improve the accuracy and speed of teleoperation, manipulation and positional control tasks. They can also provide visual or haptic feedback which leads to more intuitive operation and significantly reduces the cognitive load on the operator. Originality/value This provides an insight into the growing role of AR in robotics by providing examples of recent research in a range of applications.

SEC releases enforcement division FY 2017 annual report: shift in tone and likely approach

2018 ◽  
Vol 19 (1) ◽  
pp. 15-19
Author(s):  
Matthew C. Solomon ◽  
Robin M. Bergen ◽  
Alexis Collins
Keyword(s):  
Asset Management ◽  
Design Methodology ◽  
Annual Report ◽  
Risk Profile ◽  
Content Type ◽  
Policies And Procedures ◽  
The Us ◽  
Retail Investors ◽  
Practical Implications ◽  
Insight Into

Purpose To discuss and analyze the US Securities and Exchange Commission’s (SEC’s) FY 2017 Annual Report, which details its priorities for the coming year and evaluates enforcement actions that occurred during FY2017. Design/methodology/approach Summarizes key shifts from FY 2016, outlines the Enforcement Division’s current priorities, and, in view of its stated focus on the conduct of investment professionals and protection of retail investors, provides guidance to the investment management industry as it gears up for the coming year. Findings The Report provides insight into changes in the SEC’s approach to enforcement actions, including a general shift in tone suggesting a more measured approach to enforcement and remedies and a move away from a statistics-oriented approach, and a glimpse into its priorities for the coming year, including five core principles guiding the Division’s enforcement decisions. Practical implications As those in the asset management industry consider revisions to their policies and procedures for FY 2018, as well as their risk profile more generally, they should keep in mind key insights into the Commission’s enforcement strategy offered by the Report. Originality/value Practical guidance from experienced securities enforcement, litigation, compliance and anti-corruption lawyers.

FINRA publishes guidance on research conflict of interest rules

2016 ◽  
Vol 17 (1) ◽  
pp. 45-50
Author(s):  
Timothy Burke ◽  
Jason Pinney
Keyword(s):  
Conflicts Of Interest ◽  
Selection Process ◽  
Valuable Insight ◽  
Financial Industry ◽  
Content Type ◽  
Risk Levels ◽  
Policies And Procedures ◽  
Practical Guidance ◽  
Research Analysts ◽  
Practical Implications

Purpose To explain recent guidance released by the Financial Industry Regulatory Authority (FINRA) regarding research analyst conflicts of interest that arise during the underwriter selection process. Design/methodology/approach The article discusses the risks associated with different communications between research analysts and issuers during the three phases of the underwriter selection process: the pre-IPO period; the solicitation period; and the post-mandate period. Findings While many questions remain, the FINRA guidance provides valuable insight to firms regarding the types of communications between research analysts and issuers that are permitted during different periods in the solicitation process. The risk levels associated with different types of communications during those time periods range from low to high to “unmanageable”. The article provides practical guidance on what research analysts can say and do during the different periods. Practical implications Broker-dealers should evaluate their policies and procedures to ensure compliance with the new FINRA guidelines. Originality value Practical guidance from experienced securities lawyers who are on the front lines in dealing with these issues.

MSRB publishes its first compliance advisory for broker-dealers

2016 ◽  
Vol 17 (3) ◽  
pp. 49-51
Author(s):  
Scott R. Anderson ◽  
Kate S. Poorbaugh
Keyword(s):  
Financial Services ◽  
Design Methodology ◽  
Content Type ◽  
Compliance Programs ◽  
Policies And Procedures ◽  
Practical Guidance ◽  
Effective Compliance ◽  
Practical Implications

Purpose To summarize the Municipal Securities Rulemaking Board’s 2016 Compliance Advisory for brokers, dealers and municipal securities dealers. Design/methodology/approach Summarizes several Municipal Securities Rulemaking Board (MSRB) rules that the Compliance Advisory highlights as presenting key compliance risks for brokers, dealers and municipal securities dealers. Discusses the factors included in the Compliance Advisory that dealers should consider when evaluating compliance procedures and controls. Findings By highlighting some key compliance risks and providing considerations tailored to those risks, the Compliance Advisory can be used as a tool to aid dealers in developing and assessing effective compliance programs. Practical implications Dealers should consider reviewing their firms’ existing compliance policies and procedures in light of the considerations discussed in the Compliance Advisory. Originality/value Practical guidance from experienced securities and financial services regulatory lawyers.

Financial institutions and the new class action under Italian law: a compliance approach

2019 ◽  
Vol 20 (4) ◽  
pp. 9-14
Author(s):  
Francesco Falco
Keyword(s):  
Financial Institutions ◽  
Design Methodology ◽  
Case Law ◽  
Class Action ◽  
Content Type ◽  
New Class ◽  
Italian Law ◽  
Policies And Procedures ◽  
Practical Guidance ◽  
Practical Implications

Purpose To explain the impacts of the class action, as recently amended by the Italian Parliament, and help financial institutions to develop a compliance approach in order to avoid and/or mitigate the relevant risks. Design/methodology/approach This article provides an overview on the Italian class action, as recently amended by the Italian Law No. 31/2019, examines the relevant impact for financial institutions (taking into account some recent case law) and identifies possible compliance solutions to avoid/mitigate the relevant risks. Findings The recent amendments to the Italian class action may increase risks for financial institutions. Practical implications (Optional) Financial institutions should examine their relationships with stakeholders in the light of the new Italian class action in order to implement policies and procedures to prevent the relevant risks. Originality/value Practical guidance from an experienced lawyer in the litigation and compliance fields.

OCIE to investment advisers: focus on these five problem areas

2017 ◽  
Vol 18 (2) ◽  
pp. 16-18
Author(s):  
Brynn D. Peltz ◽  
Ilan S. Nissan ◽  
Evyn W. Rabinowitz
Keyword(s):  
Design Methodology ◽  
Code Of Ethics ◽  
Securities And Exchange Commission ◽  
Content Type ◽  
Policies And Procedures ◽  
Funds Management ◽  
Practical Guidance ◽  
Investment Advisers ◽  
Practical Implications

Purpose To explain a Risk Alert published on February 7, 2017 published by the Securities and Exchange Commission (SEC) Office of Compliance Inspections and Examinations (OCIE) describing the five compliance topics most frequently identified in deficiency letters sent to investment advisers after the completion of an OCIE examination. Design/methodology/approach Discusses deficiencies noted by the OCIE relating to the Compliance Rule, required regulatory filings, the Custody Rule, the Code of Ethics Rule, and the Books and Records Rule. Findings The OCIE published the Risk Alert with its noted deficiencies only one month after releasing its exam priorities for the year. Practical implications All investment advisers should consider reviewing their compliance practices, policies and procedures in light of the deficiencies and weaknesses identified in the SEC Risk Alert. Originality/value Practical guidance from experienced lawyers specializing in asset and funds management.

US SEC report calls for better internal accounting controls for cyber-related threats

2019 ◽  
Vol 20 (1) ◽  
pp. 5-9
Author(s):  
David Martin ◽  
David Engvall ◽  
Kerry Burke ◽  
Gerald Hodgkins ◽  
Matthew Franker ◽  
...  
Keyword(s):  
Design Methodology ◽  
Internal Controls ◽  
Public Companies ◽  
Content Type ◽  
Policies And Procedures ◽  
The Us ◽  
Practical Guidance ◽  
Internal Accounting ◽  
Corporate Disclosures

Purpose To summarize and explain the US Securities and Exchange Commission’s (Commission) recent report of investigation cautioning public companies to consider cyber-related threats when designing and implementing internal accounting controls. Design/methodology/approach Explains that the Commission’s report arose out of a Commission enforcement investigation into the internal accounting controls of nine unidentified public companies that were victims of email scams, explains that the Commission issued the report to emphasize that cybersecurity remains a high priority for the Commission and the report should serve as a reminder that all public companies need to consider cyber-related threats when devising and maintaining internal accounting controls and provides practical considerations for public companies to consider in light of the Commission’s report. Findings Public companies should assume that the Commission is actively monitoring all areas related to cybersecurity, including corporate disclosures of cyber-related incidents and also whether companies have established policies, procedures, and internal controls in place to ensure cyber-related incidents are prevented. Given that assumption, public companies should take prompt steps to assess and, if appropriate, improve internal accounting controls, disclosure controls, and cyber-related policies and procedures to address the risk of cyber-related incidents. Originality/value Practical guidance from experienced securities lawyers.

SEC administrative law judge bars investment manager for misrepresenting GIPS compliance

2014 ◽  
Vol 15 (3) ◽  
pp. 38-40
Author(s):  
Michael S. Caccese ◽  
Douglas Y. Charton ◽  
Pamela A. Grossetti
Keyword(s):  
Financial Services ◽  
Design Methodology ◽  
Performance Standards ◽  
Administrative Law ◽  
Investment Performance ◽  
Content Type ◽  
Policies And Procedures ◽  
Investment Manager ◽  
Practical Guidance ◽  
Practical Implications

Purpose – To explain an administrative law judge (ALJ) decision, along with a censure, fine, and industry disbarment, against an investment adviser for misleading advertising and false claims of compliance with Global Investment Performance Standards (GIPS). Design/methodology/approach – Explains the background to GIPS, the investment adviser’s GIPS violations, the significance of the case, and lessons to be learned by investment advisors on compliance with GIPS standards. Findings – The decision is particularly significant because the ALJ issued such severe sanctions based solely on false claims of GIPS compliance notwithstanding the fact that all reported performance returns were accurate and no investors relied on or were harmed by the false claims of compliance. Practical implications – The Zavanelli case should serve to put firms on notice that persistent noncompliance with the GIPS standards can have serious consequences and that all marketing materials should be subject to effective review and approval policies and procedures prior to distribution or publication to ensure compliance with the GIPS standards. Originality/value – Practical guidance from experienced financial services lawyers.

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