In recent years, the SEC has been conducting a nationwide and industry-wide “sweep” of investment advisory firms, pursuant to which it has opened investigations and brought enforcement actions against a multitude of...more
3/22/2022
/ Conflicts of Interest ,
Enforcement Actions ,
Failure To Disclose ,
Fiduciary Rule ,
Investment ,
Investment Adviser ,
Investment Advisers Act of 1940 ,
Regulation Best Interest ,
Revenue Sharing ,
Securities and Exchange Commission (SEC) ,
Transaction Fees
Two recent enforcement actions by the U.S. Securities and Exchange Commission (SEC), including a recent settled action against Kraft Heinz Co. (“Kraft”), underscore the agency’s renewed and continuing focus on accounting and...more
Responding to a “concern” from Chief Compliance Officers (CCOs) to the purported increase in enforcement actions holding compliance personnel personally liable, the New York City Bar Association recently released a framework...more
As we await the impact of the Biden Administration on the direction of the SEC, we have been given a glimpse of what is to come in a speech last month by the newly confirmed commissioner, Caroline Crenshaw. Specifically,...more
As political leaders continue to debate how to address climate change, the SEC is poised to take (enforcement) action. In the latest example of how the Biden Administration is influencing the priorities the SEC, the agency...more
As the cannabis industry continues to evolve and generate capital raising and investment opportunities, the SEC Division of Enforcement will continue to closely keep watch and target the bad actors that new market...more
1/27/2021
/ Accounting ,
Bad Actors ,
Broker-Dealer ,
Cannabis-Related Businesses (CRBs) ,
Capital Raising ,
Compliance ,
Enforcement Actions ,
Futures ,
Insider Trading ,
Investors ,
Marijuana Related Businesses ,
Securities and Exchange Commission (SEC) ,
Supervision
In a 30-day period, the U.S. Securities and Exchange Commission (“SEC”) has released guidance in three ways regarding certain views on the important role and potential liability risks of chief compliance officers (“CCOs”)....more
Recently, the U.S. Securities and Exchange Commission (the “SEC”) charged a dually registered firm and its Chief Compliance Officer (“CCO”) with multiple violations of the Investment Advisers Act of 1940 (“Advisers Act”). The...more
While the U.S. Supreme Court’s decision in Liu v. SEC limited the SEC’s disgorgement power, it also left open certain complicated issues that are now subject to interpretation. As we previously summarized, in an 8–1 vote, the...more
8/27/2020
/ 15 U.S.C. § 78u(d)(5) ,
Administrative Authority ,
Business Expenses ,
Calculation of Damages ,
Corporate Misconduct ,
Disgorgement ,
Enforcement Actions ,
Equitable Relief ,
Kokesh v SEC ,
Lack of Authority ,
Liu v Securities and Exchange Commission ,
Net Profits ,
Remedies ,
SCOTUS ,
Securities and Exchange Commission (SEC)
On June 26, 2020, the U.S. Court of Appeals for the Second Circuit issued its ruling on the challenge to the legality of the Regulation Best Interest final rule (Reg BI), promulgated by the U.S. Securities and Exchange...more
On June 22, 2020, the U.S. Supreme Court decided Liu v. Securities and Exchange Commission, holding the SEC may recover disgorgement as a form of equitable relief in a civil enforcement action for securities fraud, provided...more
6/25/2020
/ 15 U.S.C. § 78u(d)(5) ,
Administrative Authority ,
Business Expenses ,
Calculation of Damages ,
Corporate Misconduct ,
Disgorgement ,
Enforcement Actions ,
Equitable Relief ,
Kokesh v SEC ,
Lack of Authority ,
Liu v Securities and Exchange Commission ,
Net Profits ,
Remedies ,
SCOTUS ,
Securities and Exchange Commission (SEC)
From mid-March to mid-May, the SEC received more than 4,000 tips, complaints, and referrals. This, according to one of the SEC Co-Directors of the Division of Enforcement, represented a 35% increase over the same period last...more
As the world is navigating through COVID-19 and as we are focused on our health and well-being as we self-quarantine and engage in social distancing to do our part to stop the spread, our markets remain open, active, and...more
On March 3, 2020, the Supreme Court heard arguments in the case of Liu v. SEC, No. 18-1501. This article summarizes what transpired at the hearing, in which the arguments centered on a challenge to the ability of the U.S....more
3/21/2020
/ Administrative Authority ,
Certiorari ,
Disgorgement ,
Enforcement Actions ,
Equitable Relief ,
Lack of Authority ,
Liu v Securities and Exchange Commission ,
Penalties ,
Petition for Writ of Certiorari ,
SCOTUS ,
Securities and Exchange Commission (SEC) ,
Securities Violations ,
Split of Authority ,
Statute of Limitations
Facing a 35-day government shutdown and new restrictions on the ability to recover disgorgement, it would be perfectly understandable if the SEC’s Division of Enforcement suffered a lackluster year. Nevertheless, according to...more
11/18/2019
/ Conflicts of Interest ,
Cryptocurrency ,
Digital Assets ,
Disgorgement ,
Distributed Ledger Technology (DLT) ,
Enforcement Actions ,
Kokesh v SEC ,
SCOTUS ,
Securities and Exchange Commission (SEC) ,
Share Class Selection Disclosure Initiative (SCSD) ,
Statute of Limitations ,
White Collar Crimes
On September 30, 2019, the SEC ordered an additional 16 self-reporting investment advisory firms to pay nearly $10 million in disgorgement. Some have referred to this as the “second wave” of the SEC Division of Enforcement’s...more
On August 29, 2019, the SEC filed a complaint against a registered investment adviser alleging failures to disclose four categories of conflicts of interest and seeking disgorgement of $10 million in undisclosed compensation....more
9/12/2019
/ Conflicts of Interest ,
Disclosure Requirements ,
Disgorgement ,
Enforcement Actions ,
Failure To Disclose ,
Investment Adviser ,
OCIE ,
Revenue Sharing ,
Securities and Exchange Commission (SEC) ,
Self-Reporting ,
Share Class Selection Disclosure Initiative (SCSD) ,
Share Classes