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Securities Violations Broker-Dealer Investment Adviser

Foley & Lardner LLP

First Circuit’s Reversal of Summary Judgment Clarifies Materiality Standard for Advisory Conflicts

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A recent ruling may raise the bar for the Securities and Exchange Commission (SEC) in charging registered investment advisers for omissions of potential conflicts and seeking disgorgement, giving the defense bar additional...more

Troutman Pepper Locke

First Circuit Questions Materiality in SEC's Case Against Commonwealth Equity Services

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On April 1, the U.S. Court of Appeals for the First Circuit vacated a summary judgment ruling in favor of the Securities and Exchange Commission (SEC) against Commonwealth Equity Services, LLC, also known as Commonwealth...more

Morgan Lewis

Securities Enforcement Roundup – December 2024

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In this issue of our monthly Securities Enforcement Roundup, we highlight top securities enforcement developments and cases from December 2024. In December 2024: President-elect Trump nominated former SEC Commissioner Paul...more

Allen Matkins

SEC Settles "Charges" For Failure To File Timely Form D

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Last week, the U.S. Securities and Exchange Commission announced that it had settled "charges" against two private companies and one registered investment adviser for failing to timely file Forms D for several unregistered...more

DLA Piper

SEC Enforcement Actions Highlight Anti-Money Laundering Reporting Focus for Financial Gatekeepers

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The Securities and Exchange Commission (SEC) announced on November 22, 2024, that three broker-dealers have agreed to settle charges for filing suspicious activity reports (SARs) that failed to include important, required...more

Jones Day

SEC's and Private Litigants' Continued Focus on "AI Washing"

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On September 4, 2024, U.S. Securities and Exchange Commission ("SEC") Chair Gary Gensler reiterated concerns about artificial intelligence-related ("AI") disclosures and the need for companies to communicate accurately about...more

Carlton Fields

SEC Penalties for Off-Channel Communications: Still Blowing in the Wind

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The SEC has increased its enforcement efforts against firms that are registered as broker-dealers and/or investment advisers for alleged violations of federal securities laws involving “off-channel communications.” Such...more

Mayer Brown Free Writings + Perspectives

Broker-Dealer’s Failure to Comply with Regulation Best Interest’s Compliance Obligation is a Willful Violation of the General...

A broker-dealer (the “Dealer”) entered into a cease-and-desist order with the Securities and Exchange Commission for failing to maintain and enforce written policies and procedures reasonably designed to achieve compliance...more

Ballard Spahr LLP

Are Whistleblower Protection Violations the New SEC Sweep?

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The Securities and Exchange Commission (SEC) continues to investigate companies for including language in their employment and separation agreements or retail client settlement agreements that potentially discourages...more

Troutman Pepper Locke

SEC Charges Broker-Dealer and Two Affiliated Investment Advisers With Violating Whistleblower Protection Rule

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On September 4, the Securities and Exchange Commission (SEC) issued an order against three investment adviser firms for violating the whistleblower protections of Rule 21F-17(a) under the Securities Exchange Act of 1934. This...more

Sullivan & Worcester

SEC and CFTC Continue Their Lucrative Pursuits of Penalizing Unapproved Communication Methods

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SEC's and CFTC's Enforcement Actions Against Multiple Firms - In its continued pursuit of rooting out and penalizing broker-dealers and investment advisers for their failure to prevent unapproved communication methods, the...more

Stark & Stark

More Than $390 Million in Penalties for Recordkeeping Failures

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The Securities and Exchange Commission (SEC) announced charges against 26 broker-dealers, investment advisers, and dually-registered firms for widespread and longstanding failures to maintain and preserve electronic...more

Royer Cooper Cohen Braunfeld LLC

Advisers and AI

Earlier this year, the SEC, NASAA, and FINRA issued an Investor Alert cautioning investors about the rise of investment fraud involving artificial intelligence (AI) and other emerging technologies. The overarching concern:...more

Latham & Watkins LLP

Key Takeaways From SEC’s First “Off-Channel Communications” Settlement With Stand-Alone Registered Investment Adviser

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The SEC’s enforcement action sends a clear message that the Commission intends to enforce “off-channel communication” violations against private fund advisers that are not affiliated with a broker-dealer....more

WilmerHale

Recent Pay-to-Play Settlement: Notwithstanding a Strong Dissent Over 206(4)-5 Overbreadth, the Need for Strong Compliance Policies...

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With political campaign activity ramping up as the fall elections approach, the Securities and Exchange Commission (SEC) has indicated it will continue stringent enforcement of Investment Advisers Act Rule 206(4)-5 (the...more

Sheppard Mullin Richter & Hampton LLP

What Private Equity Firms Need to Know About the Ongoing SEC Investigation of “Off-Channel” Communications

Over the last several years, the Securities and Exchange Commission (“SEC”) has been laser-focused on the use of so-called “off-channel communications” in the financial services industry. On the theory that employees’ use of...more

Akin Gump Strauss Hauer & Feld LLP

SEC Announces First Off-Channel Communications Enforcement Action Against a Standalone Private Fund Manager

On April 3, 2024, the U.S. Securities and Exchange Commission (SEC) announced its first enforcement action against a registered investment adviser (RIA) with no ties to a broker-dealer regarding so-called “off-channel”...more

Nutter McClennen & Fish LLP

Nutter Securities Enforcement Update: March 1, 2024

The Nutter Securities Enforcement Update is a periodic update of noteworthy recent securities enforcement activity, settlements, decisions, and charges. We provide brief summaries that highlight recent enforcement action...more

Bilzin Sumberg

SEC Issues First AI-Related Civil Penalties and Warns Against “AI Washing”

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​​​​​​​The Securities and Exchange Commission on Monday, March 18, 2024, entered into settlements with Delphia (USA) and Global Predictions, which agreed to pay civil penalties totaling $225,000 and $175,000, for “AI...more

Troutman Pepper Locke

How to Avoid a Similar Fate? SEC Charges Firms With Record-Keeping Violations for Off-Channel Communications

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On February 9, the Securities and Exchange Commission (SEC) announced settlements with 16 firms relating to record-keeping violations stemming from off-channel communications totaling $81 million. The 16 firms were five...more

Seward & Kissel LLP

SEC Settles Charges Against Firm for Alleged Whistleblower Protection Rule Violations

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Who may be interested: Investment Advisers, Broker-Dealers - Quick Take: The SEC settled charges against a firm that allegedly prevented brokerage customers and advisory clients from reporting potential securities law...more

Skadden, Arps, Slate, Meagher & Flom LLP

Investment Management Update - November 2023

...SEC Adopts Amendments to Fund Names Rule - On September 20, 2023, the U.S. Securities and Exchange Commission (SEC) adopted amendments to Rule 35d-1 under the Investment Company Act of 1940 (the Fund Names Rule) as well...more

A&O Shearman

Nine Investment Firms Fined By The SEC For Marketing Rule Violations

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On September 11, 2023, the U.S. Securities and Exchange Commission announced settled enforcement actions against nine separate investment advisory firms for alleged marketing rule violations, assessing a total of $850,000 in...more

Katten Muchin Rosenman LLP

SEC Complaint Signals Aggressive Approach to Information Barriers Enforcement

On September 12, the Securities and Exchange Commission (SEC) filed a complaint in the Southern District of New York (SDNY) charging a large proprietary trading firm with making materially false and misleading statements and...more

Thomas Fox - Compliance Evangelist

Messaging App Compliance in Regulated Industries: Lessons from Recent Enforcement Actions

In recent years, regulated industries, particularly broker dealer firms like Wells Fargo and Morgan Stanley, have faced increased scrutiny from regulatory bodies due to their lack of compliance in policing messaging apps. The...more

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