Header graphic for print
Securities Compliance Sentinel Analysis of cutting-edge securities industry issues

Tag Archives: Dodd-Frank

Who Wants To Know How To Weed Out Rogue Stockbrokers

Posted in Compliance and Supervision, Dodd-Frank, FINRA Compliance, Registered Representatives, SEC Compliance

My partner, Ernest Badway, recently blogged about the dangers of a lawyer referring a client to a rogue stockbroker.  The question for the broker-dealer/investment advisors is how do you uncover rogue brokers or prevent them from infecting your firm. In all of the years that I have defended broker-dealers and investment advisors in cases involving… Continue Reading

One Thing An RIA Need Not Worry About.

Posted in Dodd-Frank, Financial Industry Trends, Investment Adviser Regulation, SEC Compliance, SEC Enforcement

Ever since Dodd-Frank, there has been much concern in the RIA world regarding who would be its regulator.  At this point, RIAs can dispense with any concern that FINRA will be its regulator because FINRA pulled its hat out of the oversight ring, at least for now. Even thought FINRA spent nearly $2 million lobbying Congress… Continue Reading

Did You Hear That FINRA May Force BDs To Wear A Scarlet Letter?

Posted in Broker-Dealer Regulation, Compliance and Supervision, Dodd-Frank, FINRA Compliance, Registered Representatives, Social Media

Much like the character in the famous Nathaniel Hawthorne story, FINRA is looking force broker-dealers to wear a mark on all of their social media.  FINRA wants to amend Rule 2267, forcing member firms to have a link to BrokerCheck on the websites and all other forms of social media. The stated purpose of doing… Continue Reading

The Thirteen Dirty Secrets That A Fraudster Does Not Want You To Know?

Posted in Compliance and Supervision, Corporate Governance, Dodd-Frank, Registered Representatives

The late great comedian, George Carlin, was made famous by his routine, “The Seven Dirty Words You Can Never Say On Televisions”.  Likewise, fraudsters do not want compliance personnel to ever mention the 13 common dirty traits that may uncover a fraud. Although not as funny as George Carlin, focusing on these traits may be… Continue Reading

ABA Seventh Annual National Institute on Securities Fraud

Posted in Dodd-Frank, Federal and State Criminal Activities, SEC Enforcement, State Enforcement

With the east coast in the midst of Hurrican Sandy, I am sure we are all thinking about a nicer place right now.  Apparently, the Seventh Annual National Institute on Securities Fraud is November 15-16, 2012 in New Orleans. For more information and to register, call 800-285-2221 or log on to:  http://www.ambar.org/sfr2012.

Who Else Wants To Avoid Being Considered A Supervisor?

Posted in Broker-Dealer Regulation, Corporate Governance, Dodd-Frank, FINRA Compliance, FINRA Enforcement, Investment Adviser Regulation, SEC Compliance, SEC Enforcement

 A simple review of FINRA’s enforcement proceedings demonstrates a new norm; compliance officers are being held accountable as supervisors for rules violations.  How can a compliance officer avoid being held accountable as a supervisor? The best way for compliance to insulate yourself is to make sure that there are clear divisions between compliance and supervisory… 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

Can The SEC And Department Of Labor Live With One Fiduciary Duty

Posted in Compliance and Supervision, Dodd-Frank, Financial Industry Trends

The Department of Labor’s head of the Employee Benefits Security Administration recently announced that the DOL is going to coordinate with the SEC on fiduciary policy, but that the DOL and SEC will maintain and pursue their own regulations.  This statement has garnered confusion and concern by many in the industry, as it should. The… Continue Reading

CFTC Approves Final Rule on Data Recordkeeping for Pre-Dodd-Frank Swaps

Posted in Dodd-Frank, Uncategorized

Last week, the CFTC issued a final rule on the data recordkeeping and reporting requirements for historical swaps.  Historical swaps are swaps executed prior to the passage of the Dodd-Frank Act and swaps entered into between the enactment of the act and applicable compliance date for recordkeeping.  For swaps in existence on or after April 25,… Continue Reading

PRIVATE GROUP SEEKS TO BAN ACCOUNTS FROM DUAL REGISTRANTS

Posted in Arbitration, Broker-Dealer Regulation, Compliance and Supervision, Dodd-Frank, FINRA Compliance, FINRA Enforcement, Intra-Industry Arbitrations, Investment Adviser Regulation, Public Customer Arbitrations, Registered Representatives, SEC Enforcement, Securities Legislation

Recently, an investor advocacy group petitioned the SEC to prohibit brokerage firms, who offer wraparound accounts, to also provide investment advice through both a duly registered BD and investment adviser.  This group claims that terminating this practice would resolve a very troubling regulatory issue.  The group also petitioned the SEC to ban mandatory arbitration accounts… 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

THE SEC’S OCIE’S SUMMER PLANS

Posted in Broker-Dealer Regulation, Compliance and Supervision, Dodd-Frank, Financial Industry Trends, Investment Adviser Regulation, Registered Representatives, SEC Compliance, SEC Enforcement

The SEC’s Office of Compliance Inspections and Examinations announced that it will increase their examinations of newly registered private fund advisers starting this summer.  These examinations are being done in conjunction with those hedge fund and private equity advisers previously registered with the Commission as a result of the Dodd-Frank Act.  The SEC Staff made… Continue Reading

OCIE’S PLAN TO REGULATE PRIVATE FUND ADVISORS

Posted in Compliance and Supervision, Dodd-Frank, Hedge and Private Equity Funds, Investment Adviser Regulation, SEC Compliance

OCIE is intending to review newly registered hedge and private equity fund advisers by focusing in on certain priorities. In particular, OCIE will review due diligence practices; fraud indicators; unknown service providers; problem custody arrangements; insider trading and front running issues; and preferential treatment to determine if there are conflicts of interest.  OCIE also intends to take a global approach… Continue Reading

SEC’S POSITION ON PRIVATE SUITS AFTER MORRISON

Posted in Arbitration, Dodd-Frank, SEC Enforcement, Securities Class Actions

In response to the Supreme Court’s decision in Morrison v. National Australia Bank where the Supreme Court said that there was no private right of action for lawsuits that involved transnational fraud, the SEC has taken a position that has angered some.  As many know, the Dodd-Frank Act confirmed the SEC’s jurisdiction as it relates… Continue Reading

FINRA ARBITRATORS AND COUNTERCLAIMS

Posted in Arbitration, Broker-Dealer Regulation, Compliance and Supervision, Dodd-Frank

The United States District Court for the District of Massachusetts, recently, ruled that a FINRA Arbitrator must consider any counterclaims in an action brought against Trustees of a profit sharing plan.  The Federal Court had refused the argument advanced by the Plan’s Trustees that naming them individually was improper under FINRA’s rules.  The Court found… Continue Reading

SEC COMMISSIONER GALLAGHER DISCUSSES CRITICAL ISSUES

Posted in Broker-Dealer Regulation, Compliance and Supervision, Dodd-Frank, Exemptions, Hedge and Private Equity Funds, Investment Adviser Regulation, SEC Enforcement

Recently, the SEC’s newest commissioner, Commissioner Daniel Gallagher, discussed certain of his beliefs, including, among other things, that the SEC should use its exemptive authority derived from the Investment Advisers Act of 1940, to provide some relief for hedge fund and private equity investment mangers from the registration provisions of said Act.  Gallagher believes that the full registration regime should not… 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

UPDATE ON HOT ARGENTINE BONDS

Posted in Dodd-Frank, Securities Class Actions

We previously blogged on the Argentina bond case.  See http://securitiescompliancesentinel.foxrothschild.com/securities-class-actions/argentinean-bond-dispute-has-gotten-hot/index.html.  Now, to update our readers, the United States District Court for the Southern District of New York has vacated the attachment orders previously placed on the Republic of Argentina’s assets held at the Federal Reserve Bank of New York.  The Court indicated that it was… 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