Doug Cornelius on compliance for private equity real estate
We’ve seen this before. Funds promote themselves as investing along some standard other than explicit financial performance. But then fail to follow the screening they profess to be using. We saw that with BNY Mellon in 2002. It represented or implied in various statements that all investments in the funds had undergone an ESG quality…
FINRA released some needed guidance to help firms comply with the new broker investment advice standards and disclosure requirements of Regulation Best Interest and the new client disclosure document Form CRS. The checklist is available on the FINRA website: https://www.finra.org/sites/default/files/2019-10/reg-bi-checklist.pdf . If you have responsibility for broker-dealer compliance the checklist looks like a great tool.
On September 17, 2019, the U.S. Department of the Treasury issued proposed regulations to implement the Foreign Investment Risk Review Modernization Act of 2018 (FIRRMA). The proposed regulations would expands the jurisdiction of the Committee on Foreign Investment in the United States (CFIUS) to review foreign investments and mitigate any potential national security concerns regarding…
The SEC charged Commonwealth Equity Services, LLC (d/b/a Commonwealth Financial Network), a registered investment adviser and broker-dealer, with failing to disclose material conflicts of interest related to revenue sharing Commonwealth received for certain client investments. According to the SEC’s complaint, Commonwealth had a revenue sharing agreement with its clearing broker for trades in their accounts….
“It pays to invest with managers who invest in their funds. ” – Russel Kinnel of Morningstar I think this statement will come as no surprise to most investors. Mr. Kinnel did some research on mutual funds to prove the point. It turns out that manager investment is correlated to better performance. Mr. Kinnel was…
One of the critical moments of the 2008 financial crisis was caused by Lehman Brothers and its effect on the Reserve Fund, a money market fund. The fund had a significant amount of short-term debt issued by Lehman. Enough that the fund had to ‘break the buck.’ Now even “cash” was not a safe place…
As an investment adviser, you can’t take the best investments for yourself and leave the lesser ones for your clients. That’s exactly what the Securities and Exchange Commission is accusing J.S. Oliver Capital and Ian O. Mausner of doing. The SEC’s Enforcement Division is alleging that J.S. Oliver and Mausner engaged in a cherry-picking scheme…
One of the many scary events in 2008 was that money had nowhere safe to go. The failure of the Reserve Fund meant cash was not safe and the banks were teetering, leaving corporate treasuries with no place to safely park the cash they would need to weather the financial crisis. Congress stepped in and…
“Understanding the needs of investors is critical to carrying out the Commission’s investor protection mission,” said SEC Chairman Mary L. Schapiro. Section 917 of Dodd-Frank required the SEC to study the existing level of financial literacy among retail investors. The study was recently released and paints an ugly picture. Here’s a key quote: These studies…
The Transaction Account Guarantee program was originally launched in 2008 by the Federal Deposit Insurance Corp. to help banks hold on to liquidity. The program gives unlimited federal guarantees to zero-interest bank deposits. This allows companies to park cash and not worry about the bank failure. Given the current low interest environment, giving up the…