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In the blitz of regulatory and financial developments that have made headlines throughout the first quarter of 2023, a recent FINRA enforcement action serves as a reminder to both broker-dealers and their representatives that Regulation Best Interest (Reg BI) remains an area of focus for FINRA. This action underscores how important it is for broker-dealers…

Given this week’s headlines, many emerging companies may be asking themselves: “Why am I holding so much cash?”
The Investment Company Act of 1940 (the 1940 Act) may be to blame.

“Inadvertent” Investment Companies

But I don’t have any intent of being an investment company. Aren’t those mutual funds or hedge funds? I’m

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On March 10, 2023, volatility resulting from concerns regarding runs on certain banks triggered trading halts in those banks’ stocks on the New York Stock Exchange (NYSE) and Nasdaq. March 13, 2023, saw additional trading halts on bank stocks. This post provides a brief explanation of the Limit Up Limit Down (LULD) rules that…

On March 1, 2023, the U.S. Department of Justice (“DOJ”) unsealed an indictment against the CEO of a publicly traded health care company (the “Executive”) relating to charges of an insider trading scheme. The indictment represents the first time that DOJ has brought criminal insider trading charges stemming from an executive’s use of a Rule…

In part one of our four-part series, we discussed the U.S. Securities and Exchange Commission (SEC) ESG-related initiatives from 2019 to 2022 that preceded the burst of ESG-related enforcement and rulemaking activity in the first half of 2022. In this second part of the series, we explore this recent enforcement activity.…

I was looking for something else on the Division of Investment Management’s (Division) website the other day and ran across a study of Prime MMFs’ Asset Composition and Asset Sales (the Study) released by its Analytics Office in June. Nothing indicates why the Study was prepared, but I hope it reflects an effort by the Division to better understand how prime institutional money market funds operate and the potential consequences of the proposal to require these funds to employ “swing pricing” whenever they have net redemptions. The Study supports my conclusion that this proposal would dilute redeeming shareholders rather than preventing dilution to remaining shareholders.…

In the first half of 2022, we saw significant U.S. Securities and Exchange Commission (SEC) enforcement and rulemaking activity around ESG investing, and the SEC’s intense focus in this area shows no signs of abating as we move through the third quarter. In this four-post series we:

  • Summarize the 2019-2021 ESG-related initiatives at the SEC;
  • Review the SEC’s ESG-related enforcement activity in the asset management industry;
  • Outline the SEC’s May 2022 ESG-related rule proposals for funds and advisers; and
  • Suggest factors that mutual fund boards should consider in their oversight of ESG funds and adviser ESG initiatives.

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