The United States Securities and Exchange Commission (“SEC”) adopted amendments to the definitions of both accredited investor under Securities Act of 1933 (“Securities Act”) Regulation D Rule 501 and qualified institutional buyer (“QIB”) under Securities Act Rule 144A.

Under the new accredited investor definition, the following parties would now be considered accredited investors: (1) designated

FINRA’s National Adjudicatory Counsel (“NAC”), recently, affirmed a disciplinary panel decision significantly sanctioning a broker-dealer for paying unregistered persons and entities.  See https://www.finra.org/sites/default/files/2020-07/NAC_2014042606902_Silver-Leaf_062920.pdf.

FINRA alleged, among other things, that a broker-dealer paid transaction-based compensation to “unregistered finders,” and non-registered entities owned by its registered persons.   Ultimately, the NAC agreed that, over a 3 year period,

The SEC’s Office of Compliance Inspections and Examinations (“OCIE”) conducted a series of examinations into private fund advisers. See the SEC risk alert here. To say the least, OCIE was not pleased with the results, indicating a significant percentage of these advisers had compliance issues.  In particular, OCIE found problems with: (1) conflicts of

The SEC’s Office of Compliance and Inspections (“OCIE”), recently, issued an alert—more like a shot across the bow—to BDs and RIAs regarding its concerns over activities in the industry concerning the challenges encountered by COVID-19.  See https://www.sec.gov/files/Risk%20Alert%20-%20COVID-19%20Compliance.pdf.  As part of its efforts, OCIE made certain recommendations concerning: (1) investor asset protection; (2) personnel supervision; (3)

Recently, the United States District Court of the District of Columbia refused to dismiss money laundering charges against a defendant who was allegedly engaged in a darknet cryptocurrency scheme.   See U.S. v. Harmon, Case Number 1:19-cr-00395-BAH (D.D.C. July 24, 2020) .

Essentially, the defendant tried to claim that, when he transferred more than 350,000

Fox Rothschild’s Securities Industry Group and Labor & Employment Department have updated the firm’s National Survey on Restrictive Covenants, a quick reference guide for in-house counsel and human resource professionals in a variety of industries.

Restrictive covenant law is in a constant state of flux and varies considerably from state to state. Our national survey

The United States Department of Labor (“DOL”) has had a very active summer regulating the securities industry. Yes, you heard it right, the DOL has made certain pronouncements that have considerable effect on the securities industry.

Initially, the DOL allowed 401(k) plans to invest in private equity funds so long as they are managed by

Join our colleagues, Jon Heyl and Alex Kerzhner, in what is sure to be an important review of the challenges facing the PE/HF industry during the pandemic.   The webinar will take place on Thursday, June 4, 2020 at 2 p.m. (EDT)/ 11 a.m. (PDT).

Please register (or click) at this site:  https://foxrothschild2.webex.com/mw3300/mywebex/default.do?nomenu=true&siteurl=foxrothschild2&service=6&rnd=0.520498216233004&main_url=https%3A%2F%2Ffoxrothschild2.webex.com%2Fec3300%2Feventcenter%2Fevent%2FeventAction.do%3FtheAction%3Ddetail%26%26%26EMK%3D4832534b00000004a042107c2af537d531b2ac872f843c41108c4da97db0231303c011bd8277765f%26siteurl%3Dfoxrothschild2%26confViewID%3D161131266161257810%26encryptTicket%3DSDJTSwAAAASqE0ZuyzNd7jcvQfkqx3mqfGmPjA6SK9Z5v54tVs7LwQ2%26

 

Sadly, the hackers of the world have not let the pandemic get in the way of their nefarious activities.  In particular, BDs and RIAs have been primary targets.   In our prior blog postings, we discussed business continuity plans and the requirement these plans include cybersecurity provisions.   We believe that the SEC, FINRA, and the various