The Securities and Exchange Commission filed charges against a fund manager and its subadviser for their extensive use of derivatives. From April 2007 through October 2008, the Fiduciary/Claymore Dynamic Equity Fund engaged in derivative strategies to supplement the Fund’s primary investment strategy. But the Fund failed to include adequate disclosure about the risks to the … Read more »
Category: Compliance Programs
How Effective is Your Gate?
Does your compliance program sometime feel like this gate? A tool working alone is not necessarily effective. It may be a great tool, but still not be effective. If it’s easy to get around then it’s not effective. Do you even know if people are going around? Is it even possible to know if they … Read more »
Compliance Bricks and Mortar for January 11
These are some of the compliance related stories that recently caught my attention. On the lighter side there has been a bit attention focused on a presidential appointment. Jack Lew, President Obama’s reported pick to replace outgoing Treasury secretary Tim Geithner, has drawn some unusual scrutiny because of his signature. Jack Lew’s Terrible Signature May … Read more »
Suspicious Activity Reports and Private Funds
Over the years, the Financial Crimes Enforcement Network (FinCEN) has required banks, brokers, and other financial entities to officially report suspicious activities of its customers. Investment advisers and private fund managers have managed to sty outside the requirements. In large part, that’s because a fund’s custodial accounts are already subject to the self-policing. since the … Read more »
Do You Have Skin in the Game?
If you tell investors that you have skin in the game, you need to have skin in the game. For the second time this year, the SEC has brought an enforcement action against a private fund for falsely informing investors that the Managers had skin in the game. Most investors want a manager’s executives to … Read more »
Happy Thanksgiving
Thanksgiving Puck 1910 / BBaker. Creator(s): Baker, Bryant, 1881-1970, artist Date Created/Published: N.Y. : Published by Keppler & Schwarzmann, Puck Building, 1910 November 23. Read more »
Warren Back in Washington
The last time Washington saw Elizabeth Warren, she was thrown out of town for her strong advocacy of the Consumer Financial Protection Bureau. The Dodd–Frank Wall Street Reform and Consumer Protection Act established the CFPB. Warren is credited with creating the CFPB, tirelesslessy lobbying for its inclusion in Dodd-Frank, and worked on implementation of the … Read more »
Sandy and Disaster Preparedness
Disaster recovery is an important, though not explicitly mandatory, component of compliance program. The Securities and Exchange Commission alludes to this in the release for the compliance rule. It’s also a key part of personal plan. I’m learning that first hand. My family is spending its third day without power. Fun and exciting at first, … Read more »
Aberrational Performance Inquiry of Nabs Another Private Fund Manager
The SEC has once again claimed that its Aberrational Performance Inquiry has identified another miscreant. Once again, I’m skeptical that the SEC is actually using “proprietary risk analytics” to identify hedge funds with suspicious returns. The SEC alleges that Yorkville Advisors overstated the value of the assets in its funds to improve marketability and increase … Read more »
Why Have a Compliance Program?
I’m working on presentation for a continuing education program and decided to step back and look at the basics. I went all the way back to “why?” You Are Required Sometimes the answer is easy. You have to have a compliance program. Your company is in a heavily regulated industry that explicitly requires a formal … Read more »