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Category Archives: SEC Organization

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What To Expect In 2014 From The SEC’s Enforcement Division

Posted in Broker-Dealer Regulation, Hedge and Private Equity Funds, Insider Trading, Internal Investigations, Investment Adviser Regulation, SEC Compliance, SEC Enforcement, SEC Organization, SEC Structure, Whistleblowers

Now that 2014 is here, it is a good idea to understand what the Enforcement Division might focus on this year.  In a recent article that appeared in the BNA, David Marder, a partner with Robins, Kaplan, Miller & Ciresi identified fifteen things to expect in the coming year.  The fifteen things he noted to… Continue Reading

THE SEC IS REALLY WORKING ON DODD-FRANK

Posted in Dodd-Frank, SEC Organization, SEC Structure

The SEC has been routinely criticized for not completing its administrative work under the Dodd-Frank Act.  Despite this criticism, the SEC stated that it had only 4 remaining initiatives it must complete.  http://www.sec.gov/new/studies/2013/sec-organizatinal-reform-recommedations-043013.pdf and http://www.sec.gov/new/studies/2011/967study.pdf. The SEC must, now, reorganize the Offices of Administrative Services, Financial Management, and Human Resource, as well as create the… Continue Reading

SEC RESTRUCTURING HAS LED TO MORE ENFORCEMENT

Posted in SEC Enforcement, SEC Organization, SEC Structure

The SEC’s 2010 restructuring of its Enforcement Division has resulted in the agency taking on more complex cases with a new level of expertise.  The SEC has hired specialists, including highly educated analysts who understand quantitative and high-frequency trading to assist the SEC with its enforcement investigations.  The experts act in both the SEC’s enforcement… Continue Reading

Is the IM Division Changing with the Times? New RIAs Force Looksy With the Advisor’s Act

Posted in Dodd-Frank, Financial Industry Trends, Hedge and Private Equity Funds, Investment Adviser Regulation, SEC Compliance, SEC Organization, SEC Structure

The SEC’s Division of Investment Management has publicly stated that it will review the regulations relating to the Investment Advisers Act of 1940 given the large influx of new RIAs as a consequence of the registration of hedge and private equity fund managers. These new RIAs, now, account for roughly 40% of all RIAs.  IM is looking… Continue Reading

Investment Advisers; A Reprieve For Now

Posted in Dodd-Frank, Investment Adviser Regulation, SEC Compliance, SEC Enforcement, SEC Organization, SEC Structure

One of the more anticipated and debated outgrowths of the Dodd-Frank Act was the designation of a self-regulatory organization responsible for investment advisers.  Yet, it has recently been reported that this issue is dead for the current Congressional session, although likely to come back again. The only consensus thus far is that the SEC is… Continue Reading

Intriguing Thoughts on Regulatory Sovereignty

Posted in International Securities Regulation, SEC Organization, SEC Structure

In a speech by SEC Commissioner Elisse B. Walter, the SEC, apparently, is indicating a significant shift in its view of cross-border cooperation.  Over many years, the SEC has been viewed as the nearly primary global regulator of the securities markets.  Although this sentiment is not always shared by our brethren overseas, it has been, frankly, a… Continue Reading

SEC’s IG is at it Again

Posted in SEC Organization, SEC Structure

Apparently, despite the Inspector General change, the SEC continues to be beset by problems with its internal operations that its Inspector General has recently pointed out.  The OIG has detailed in several reports problems relating to privacy violations as well as building security issues, among other areas.  Additionally, the OIG has indicated that it will be releasing several… Continue Reading

Recent Legislative Initiatives. . . Yes, We Have Reached the Silly Season

Posted in SEC Organization, SEC Structure, Securities Legislation

Despite the fact people are still unemployed, the drought rages and farmers suffer, and the deficit continues to grow, Congress seems to float absurd legislation across the partisan divide to regulate the regulators and the market. In particular, the House passed a bill that would tighten the cost-benefit analysis for both the SEC and CFTC… Continue Reading

SEC’s Business Continuity Issues Continue

Posted in SEC Organization, SEC Structure

Apparently, despite requiring public companies and regulated entities to prepare for business disruptions, the SEC’s house does not seem to be in order. In a recent report, the SEC was criticized for not having a comprehensive business disruption program, and allowing certain important activities to be at risk if there was a business disruption.  For example, the SEC… Continue Reading

Will The SEC Address Its Cost-Benefit Analysis?

Posted in Financial Industry Trends, SEC Organization, SEC Structure

The SEC’s obligation to review its proposed rules through a cost-benefit analysis has been under fire for quite some time.  More recently, the SEC has been especially criticized in failing to apply this approach in a meaningful way when it came to its review of a potential uniform fiduciary duty standard for those who provide… Continue Reading

FINRA Seeks Expansion At A Time Of Contraction

Posted in Broker-Dealer Regulation, FINRA Compliance, FINRA Enforcement, Investment Adviser Regulation, SEC Compliance, SEC Enforcement, SEC Organization

Chairman Ketchum is seeking new areas of growth for FINRA.  At FINRA’s annual meeting, Ketchum stated that he wanted to see FINRA take on the role as regulator for both retail professionals and institutions.  He also wants greater market transparency through the use of audited quote and trade systems.  Ketchum stated that he wants to see investors increase… Continue Reading

“It Feels Like Deja Vu All Over Again”; The SEC Attack On Lawyers

Posted in SEC Compliance, SEC Enforcement, SEC Organization, SEC Structure

Yogi Berra’s famous quote seems like it was written for SEC Enforcement Division Director Robert Khuzami, and what has become his all too frequent outcry regarding lawyers who practice before the SEC.  He claims that attorney misconduct is occurring frequently enough that he has to raise these issues once again.  Khuzami claims that problematic attorney… Continue Reading

Broker Routing Decisions; Are There Conflicts Of Interest

Posted in Broker-Dealer Regulation, SEC Compliance, SEC Enforcement, SEC Organization, Securities Legislation

As a result of conclusions from a recent study by Woodbine Associates, Senator Charles Schumer wrote to SEC Chairman Schapiro requesting that the SEC take action to ensure that brokerages disclose rebates and incentive payments they receive from national exchanges and other trading venues that they receive for routing securities transactions to those entities.  According to Schumer, the… Continue Reading

IS IT POSSIBLE TO FIND CAPITAL FORMATION SUCCESS OVERSEAS?

Posted in Corporate Governance, Dodd-Frank, Financial Industry Trends, SEC Organization, Securities Legislation, Securities Registration

In its never ending quest to find suitable ways to address capital formation issues in the United States, the SEC’s Division of Corporation Finance is looking to see if foreign jurisdictions handle some of these issues better and if it could be applied in the United States.  For example, the SEC is looking to see if other… Continue Reading

FINRA As The SRO For RIAs, Not So Fast

Posted in Compliance and Supervision, Dodd-Frank, Investment Adviser Regulation, SEC Compliance, SEC Enforcement, SEC Organization, SEC Structure

The battle lines are being drawn over Congressman Bachus’ bill which would authorize one or more self-regulatory organizations for investments advisers.  Many have believed that FINRA would be the obvious choice to take on this new role.  Not Congresswoman Maxine Waters, the second-highest ranking Democrat on the Financial Services Committee; she favors the SEC keeping oversight… Continue Reading

IS THE SEC COOKING THE BOOKS?

Posted in Dodd-Frank, SEC Compliance, SEC Enforcement, SEC Organization, SEC Structure

Recently, SEC Chairman, Mary Shapiro, was called to task for the high number of reported administrative proceedings by Congress.  In particular, the SEC was accused of reporting follow on administrative proceedings as if they were new actions when it announced the yearly enforcement statistics.  Such reporting gives the indication that the SEC is bringing more cases than … Continue Reading

A Bill Is Pending That Backs An SRO for RIAs, Which May Be FINRA.

Posted in Compliance and Supervision, Dodd-Frank, Financial Industry Trends, Investment Adviser Regulation, SEC Compliance, SEC Organization, SEC Structure, Securities Legislation

Congressman Bachus (R-Ala.) introduced a bill that would shift the oversight of registered investment advisers from the SEC to a self-regulatory organization that would report to the SEC.  This development represents the crystallization of one of the fears emanating out of Dodd-Frank, which mandated that the SEC study how to tighten oversight over RIAs. Advisers fear that an… Continue Reading

The SEC Is To Employ Cost-Benefit Analysis For Its Rule-Making

Posted in Dodd-Frank, SEC Compliance, SEC Enforcement, SEC Organization, SEC Structure, Securities Legislation

According to an internal SEC guidance report, the SEC is taking to heart the criticism that it does not employ enough of an economic analysis in its rule-making process.  The guidance directed the SEC to take a cost-benefit approach to all rule-making, regardless if the rules are discretionary or mandated by Congress. This guidance report… Continue Reading

The SEC’s Reform Will Continue, But Not To The Same Degree

Posted in Dodd-Frank, SEC Compliance, SEC Organization, SEC Structure

The Dodd-Frank Act directed the SEC to reform itself.  In a recent report on its progress, the SEC stated that its efforts will be reduced in 2012.  The SEC will focus on a limited number of projects that will have the greatest impact or cost savings.  The SEC plans to further focus on those items that will most benefit the… Continue Reading

The SEC Has New Toys, Big Brother Is Watching

Posted in SEC Compliance, SEC Enforcement, SEC Organization, SEC Structure

Chairman Schapiro recently announced several technology enhancement initiatives that are designed to improve the SEC’s enforcement efforts and business practices.  These initiatives were certainly designed to enhance the SEC’s ability to monitor activity to bolster its quiver of ammunition against improper activity. Among other things, the SEC implemented new search capabilities that permit SEC staff… Continue Reading

Dodd-Frank; Is It Doomed To Fail?

Posted in Broker-Dealer Regulation, CFTC Enforcement, Compliance and Supervision, Dodd-Frank, FINRA Compliance, FINRA Enforcement, Investment Adviser Regulation, Registered Representatives, SEC Compliance, SEC Enforcement, SEC Organization, Securities Legislation

Much has happened in nearly one since since the Dodd-Frank Act became effective, and much more remains.  According to the recent thoughts of one commentator, Kyle Colona of Compliance EX, Dodd-Frank may be doomed to fail as it faces it first year of existence. Colona noted five factors working against the full implementation of the… Continue Reading

Fox Guarding Hen House? Chamber of Commerce proposals for SEC Overhaul.

Posted in SEC Organization, SEC Structure

Although the report submitted by the United States Chamber of Commerce regarding an overhaul of the SEC will probably have no immediate effect, it does present several interesting specific recommendations to improve the SEC.  In particular, its 28 recommendations include adding two more commissioners to the SEC and having three separate subcommittees cast with different… Continue Reading

No Fiduciary Duty, But More Analysis

Posted in Broker-Dealer Regulation, Compliance and Supervision, Dodd-Frank, FINRA Compliance, FINRA Enforcement, Registered Representatives, SEC Compliance, SEC Enforcement, SEC Organization, SEC Structure

The SEC’s delay in adopting an uniform fiduciary duty will only be prolonged but yet another analysis that the SEC will commission.  Chairman Schapiro recently announced plans to issue a public request for information regarding “retail financial advice and the regulatory alternatives”.  With respect to the adoption of the uniform fiduciary duty standard, the SEC… Continue Reading