This is a summary of the key findings of the SEC's charges regarding electronic communications.

Electronic and Technology Takeaways from SEC’s Billion Dollar Penalties

On September 22, 2022, the Securities and Exchange Commission announced charges against 15 wall street broker-dealers and one affiliated investment adviser for widespread and longstanding failures by the firms and their employees to maintain and preserve electronic communications during January 2018 through September 2021 review period. You can read the commissions summary and links for all 15 orders here. Below are some of the key finding and takeaways.  Attestations Alone Don’t Protect the Firm   What’s key about these charges is that many of the Firm’s had procedures, training and even attestations in place for all Associated Persons to document and Read more about Electronic and Technology Takeaways from SEC’s Billion Dollar Penalties[…]

Key Steps for Starting a Broker-Dealer

Key Steps for Starting a Broker-Dealer

Individuals and companies desire to start a broker-dealer for many reasons including to facilitate sales, create an entry point for foreign financial institutions, or be a part of a larger financial plan. Some of the benefits to starting a broker-dealer (vs. purchasing an existing one) include saving money on due diligence, having no prior regulatory or financial issues, and the ability to customize it to fit your desired products and business lines. If you are looking for more pros and cons to starting vs. Buying a broker-dealer, read one of our recent posts on the topic “here”. If you decide Read more about Key Steps for Starting a Broker-Dealer[…]

What’s ‘New’ about the SEC’s New Marketing Rule for Investment Advisers?

What’s ‘New’ about the SEC’s New Marketing Rule for Investment Advisers?

Marketing and advertising in the mid-20th Century was very different then what exists in today’s world of social media. Marketing and advertising are constantly evolving. Today’s social media influencers, hashtags, comments, likes, and posts can all be used for marketing purposes. With this in mind, it makes sense that regulations should evolve as well and not be stuck in the past. In December 2020, the SEC adapted regulations to better align with the 21st Century’s marketing environment. The 1961 Advertising Rule 206(4)-1 2021 combined with the Cash Solicitation Rule206(4)-3 will now be regulated under a single rule referred to as Read more about What’s ‘New’ about the SEC’s New Marketing Rule for Investment Advisers?[…]

ESG Investing

ESG Investing

ESG (Environmental, Social and Governance) products and financial services have become a popular word in the world of regulation. With the SEC’s Risk Alert on The Division of Examinations’ Review of ESG Investing and the most recent 2022 SEC Examination Priorities Report, understanding key compliance considerations to protect your Firm is vital. If your Firm provides these products and financial services, we have provided some key tips and compliance considerations. What is ESG Investing: ESG investing is a term that has many different meanings and may go by different names such as sustainable investing, socially responsible investing, and impact investing. Read more about ESG Investing[…]

Amendments to FINRA Rules for Security-Based Swaps

Amendments to FINRA Rules for Security-Based Swaps

In an effort to clarify the rules regarding security-based swaps (SBS), FINRA has adopted amendments to rules 0180, 4120, and 4220. FINRA had previously adopted temporary relief from the application of most FINRA rules to SBS (Rule 0180), in tandem with temporary exemptive orders issued by the SEC relating to the definition of SBS as securities, as well as an interim pilot program with respect to margin requirements for transactions in CDS held in an account at a member (Rule 4240). These rules expire on February 6, 2022, and April 6, 2022, respectively. Amendments to Rule 0180 FINRA has adopted Read more about Amendments to FINRA Rules for Security-Based Swaps[…]