FINRA’s New Q&A Guidance on Reporting Customer Complaint Information

Under FINRA Rule 4530 that became effective on July 1, 2011 governing reporting requirements for customer complaints, FINRA issued Regulatory Notice 11-10 reminding member firms of the requirement that they electronically report specified events and quarterly customer complaint information.

Member firm are also required to file with FINRA copies of certain criminal actions, civil complaints and arbitration claims. The Notice also provided guidance on automated reporting under the new rule. To assist member firms with implementation, in new Notice 11-32, FINRA has provided questions and answers regarding the application of the new rule. FINRA has said it will use the information for regulatory purposes to identify and initiate investigations of member firms, offices and associated persons that it believes might pose a risk. View Notice.

Effective July 21, 2011, Advisers to Hedge Funds and Private Equity Funds Face Registration

Under Title IV of the Dodd-Frank Wall Street Reform and Consumer Protection Act, effective July 21, 2011, changes to the registration and reporting and recordkeeping requirements of the Investment Advisers Act of 1940 require advisers to private funds (hedge funds and private equity funds) to register with the SEC. In the past, many of these advisers relied on the so-called “private adviser” exemption to avoid registration. Under Section 403 of the Dodd-Frank Act, now some of these same advisers that exclusively advise venture capital funds and private fund advisers with less than $150 million in assets under management in the United States, face narrower exemptions for adviser registration. However, foreign private advisers and advisers to licensed small business investment companies are exempted.

Under the Dodd-Frank Act, the SEC will also have the authority to collect data from investment advisers about their private funds for the purposes of the assessment of systemic risk by the Financial Stability Oversight Council. Finally, the Dodd-Frank Act modifies the allocation of regulatory responsibility for mid-sized advisers between state regulators and the SEC. View More…

Dodd-Frank: More New Rules for Investment Advisers and Hedge Funds

The Securities and Exchange Commission now has new rules implementing core provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act regarding investment advisers, including those that advise hedge funds.

The Securities and Exchange Commission has adopted rules that now require advisers to hedge funds and other private funds to register with the SEC, establish new exemptions from SEC registration and reporting requirements for certain advisers, and reallocate regulatory responsibility for advisers between the SEC and states. View More…

Insider Trading by Accountants, Attorneys and Other Professionals

Why do people, who should presumably know better than most i.e. accountants and attorneys, continue to engage in insider trading by misappropriating material non-public information from the companies they serve? In doing so, either through ignorance or pure greed (or both) they end up leaving a “paper trail” long enough for the SEC to follow right to their door and the doors of their family members and friends.

The SEC’s most recent case against a former Deloitte partner continues a long line of such cases. View More…