Doug Cornelius on compliance for private equity real estate
The Securities and Exchange Commission and the DOJ filed another case against an Equifax employee who figured out that the breach remediation plan was actually for Equifax and not a client. Sudhakar Reddy Bonthu, like Jun Ying in the earlier case, Bonthu was working on Project Sparta which was identified as a fast-breaking opportunity for … Read more »
One of the 2018 exam priorities for the Securities and Exchange Commission is “matters of importance to retail investors.” The SEC has found many problems with advisers selling their clients higher cost share classes of mutual funds that paid the adviser a fee. It’s not that a registered investment adviser can’t take that 12b-1 fee. … Read more »
After last week’s Supreme Court decision in Lucia v. Securities and Exchange Commission, it’s clear that administrative law judges of the US Securities and Exchange Commission are not mere federal employees but qualify as “Officers of the United States” under the Appointments Clause of the US Constitution. That means they need be appointed by the … Read more »
In a completely unsurprising statement, a high-ranking official at the Securities and Exchange Commission said that Bitcoins are not securities. William Hinman, Director, Division of Corporation Finance at the SEC, gave detailed speech on cryptocurrency. When we see that kind of economic transaction, it is easy to apply the Supreme Court’s “investment contract” test first … Read more »
The Supreme Court issued its decision in Lucia v. Securities and Exchange Commission. The problem is that the administrative law judges were appointed by an internal panel instead of by the President or the SEC Commissioners. The Appointments Clause of the Constitution is there to make sure that those who wield power are subject to “political … Read more »
These are some of the compliance-related stories that recently caught my attention. Is Over-Regulation Really the Reason There are Fewer IPOs? by Kevin LaCroix There is one aspect of Coffee’s analysis that in my mind warrants further consideration. In discussing the advantages for smaller companies of raising money through venture capital or private equity rather … Read more »
It’s not often that I open The Boston Globe and see a front page story about compliance with Security and Exchange Commission’s Rule 206(4)-5: Patrick stays quiet as his former aide runs for governor. Jay Gonzalez was the former Secretary of Administration and Finance for the state of Massachusetts under Governor Deval Patrick. Mr. Gonzalez … Read more »
There has been a problem floating around for custody for investment advisers. Custody agreement between the client and qualified custodian may permit the adviser to do things with the assets in the account that create a custody problem. The Securities and Exchange Commission had been noticing this problem and last February issued a Guidance Update … Read more »
The Securities and Exchange Commission has been skeptical of registered investment advisers using advertisements. The default position is always that it’s likely to be fraudulent, deceptive or manipulative and therefore a violation of Section 206 of the Investment Advisers Act. The level of skepticism has been even higher for performance advertisements and even higher for performance … Read more »
Back a few years ago there was blue collar insider trading case. Some workers on a railroad noticed a lot of guys in suits walking around the rail yards. Their boss made some unusual requests about equipment. The two workers put to and two together and took a guess that the railroad was for sale. … Read more »