Featured Posts

PRIVATE FUND OFFERINGS: With General Solicitation Relaxation Comes New Scrutiny

  While under the JOBS Act the capital formation process in private offerings may have gotten easier, the regulatory scrutiny may have gotten harder. In a speech before the PLI Hedge Fund Management Conference in New York, Norm Champ, the SEC’s Director of the Division of Investment Management, addressed the increased oversight advisers to hedge funds relying on private offering … Read more

The SEC has issued a new Risk Alert stemming from its observations of  the  business continuity and disaster recovery planning practices of  a number of  investment advisers.  The alert follows an National Examination Program (“NEP”) review of the plans of approximately 40 investment advisers following  Hurricane Sandy.  The SEC says the goal is to encourage investment advisers to review their business continuity and disaster recorvery plans (“BCPs”) to … Read more

SEC Risk Alert: Options Trading That Evades Short-Sale Rule Requirements

Short sale activity continues to be a significant focus of the SEC, particularly when it involves short sales without delivery, or “failures to deliver.” The SEC’s Office of Compliance Inspections and Examinations (OCIE) has now  issued a new Risk Alert raised by its examination staff’s observation that some options trading strategies are being used to evade the short-sale rule, Rule 10b-21.  … Read more

Two SEC enforcement cases last week demonstrate (i) how using affiliated brokerage on an agency or principal basis raises potential conflicts of interest  when dealing with ” best execution” concerns , and (ii) the importance of having robust best execution policies and procedures and then following them.  In both cases, the SEC sanctioned investment advisers for not heeding … Read more

THE UPWARD TREND IN MUNCIPAL SECURITIES CASE ENFORCEMENT

The past two weeks has seen the SEC’s continued ratchet upward the number of enforcement actions against municipal securities participants for disclosure violations. These enforcement actions also continue to ensnare an array of players in municipal securities transactions, that include underlying obligors, their chief executive officers, national and regional investment banks, the heads of public finance departments at several investment banks, as well as individual investment bankers … Read more

  The August 15 deadline for investment advisers to make Form 13F filings to report equity security securities holdings of their managed accounts is approaching.  Form 13F must be filed within 45 days of the end of a calendar quarter. As required by Section 13(f) of the Securities Exchange Act of 1934, and rule 13f-1, Institutional investment managers ( which … Read more

The SEC has announced its schedule for the  upcoming Compliance Outreach Program regional seminars to be held in Chicago, New York, Atlanta and San Francisco.   Investment adviser and investment company senior officers, including chief compliance officers (CCOs) are invited to register and attend.  The first meeting will occur in Chicago on August 28.   This years’ Compliance Outreach Program, which started off  in … Read more

Time For Quarterly Transaction Reports

A reminder to advisers,  the code of ethics you adopted probably requires quarterly reports to be prepared for all personal securities transactions made by access persons.  If it doesn’t there are two possible reasons (1) chances are you haven’t read it, or (2) you don’t have one — in which case you need to first read Rule 204A-1 of the … Read more

Broker-dealers and other financial service firms using third-party service vendors, whether to reduce costs, enhance performance, and obtain access to specific expertise, and perform vital functions, sounds good in most instances.  But doing so is not without risks. FINRA’s recent disciplinary action against Ameriprise, tagging it with a censure and fine of $525,000, is a reminder of inherent risks when firms fail … Read more

FINRA’s Targeted Examination Letter on Social Media Use

June 2013,  has seen FINRA publish another targeted examination letter — this time aimed at members and associated persons use of social media.  FINRA uses these letters, primarily, to educate member firms about how it uses targeted exams, known as sweeps, to gather insights on member regulatory responses on emerging issues, and carry out investigations. Relying … Read more