Litigation

SEC Disgorgement Power at Risk in Supreme Court Case

The SEC this month filed a brief in the U.S. Supreme Court that may make the difference between whether it can continue to request that courts impose disgorgement against defendants or whether it can no longer do so. If the Commission loses the argument before the high court, the ramifications are likely to be significant, not only for the SEC and those it regulates, but for other federal agencies, as well.

Adviser in Court after SEC Charges Owner and Firm with Improper Transaction Costs

The owner of both an advisory firm and a broker-dealer found himself in federal court after the SEC filed charges that he and his advisory firm invested their clients in a version of a security that charged significant transactional sales charges - most of which the broker-dealer allegedly pocketed - when the identical security was available without these costs.

Eight Attorneys General Take SEC to Court over Regulation Best Interest

It was perhaps inevitable, given the divisions over the SECs adoption of Regulation Best Interest. Eight attorneys general, representing seven states and the District of Columbia, this month filed suit in federal court, asking, among other things, that the Rule be tossed. The states – New York, California, Connecticut, Delaware, Maine, New Mexico, Oregon – […]

Adviser in Court over Allegations It Failed to Disclose Investment Terms and Owners Profits

An adviser and his companies are facing charges in federal court from the SEC that they deceived eight clients to invest more than $3 million without disclosing a conflict of interest that allegedly led them to lose approximately $640,000 in principal, as well as untold amounts of lost interest. The charges, filed as part of […]

SEC Alleges Adviser Engaged in Share Class Violations and Other Conflicts of Interest

The SECs focus on advisers placing clients in certain higher-fee mutual fund share classes when less expensive share classes of the same investment are available shows no sign of abating – as evidenced by the agencys August 29 complaint in federal court charging a dually registered adviser with doing just that. Denver-based advisory firm Cetera […]

Incubator Fees Land Private Fund Adviser in Court

One of the SECs perennial targets is advisers charging excessive fees – and then failing to disclose those fees to its clients or funds. In a complaint this month in federal court, the SEC charged an advisory firm to private venture capital funds and its owner with doing both. California-based Frost Management Company and its […]

Adviser Settles Allegations of Conflicts of Interest and Acting as an Unregistered Broker

Two hot buttons for the SEC are conflicts of interest and advisers or broker-dealers acting without proper registration. Advisers would be wise to take a lesson from a new agency settlement that revolves around both of these issues. The SEC recently settled charges with Alaska-based advisory firm Foundations Asset Management and two of its principals […]

SEC Takes Adviser to Court over Share Class and Revenue Sharing Conflicts

The SEC this month charged a large Massachusetts-based advisory firm with conflicts of interest over its alleged failure to disclose to clients ways in which it benefitted at their expense. The enforcement action is an example of the agency cracking down on both share class violations and improper revenue sharing. Commonwealth Equity Services, a dually […]

Clayton Backs Simultaneous Resolution of Settlement Offers and Waiver Requests

Advisers and their attorneys face a problem when the SEC acts on a settlement offer but holds off on granting related waiver requests - leaving them in the position of having to decide whether to accept a settlement without knowing whether needed waivers are forthcoming. Those facing agency enforcement will likely be happy to know that SEC Chairman Jay Clayton this month came down on the side of simultaneous resolution of both.

Clayton Addresses Recent Court Rulings and the Path Forward

The SEC has been buffeted by several court decisions in recent years - Kokesh in 2017, Lucia in 2018, Robare and Lorenzo this year. At least two of these had a negative impact on how the agencys Division of Enforcement operates, while one can be seen as enhancing the Divisions enforcement authority. SEC Chairman Jay Clayton, in a recent speech, described his thoughts about these decisions and how the SEC intends to move forward.

Audio Interviews

How to Read an SEC Enforcement Action

Stern Tannenbaum law firm partner Aegis Frumento on how to get the most from reading an SEC administrative order or court complaint.

Most Important Supreme Court Decisions for Advisers and Funds

Find out the high court decisions from recent years that are likely to affect how advisers and investment companies work from Debevoise partner Robert Kaplan. 

Top 10 Cybersecurity Steps to Take Now

Sutherland law firm partner Brian Rubin shares the most urgent cybersecurity steps for investment advisers.

Top Marketing Problems … and Solutions

Get solutions for the top marketing challenges that advisers face from ACA Compliance Group managing director Kimberly Daly

Watch Out for 5 Cybersecurity Myths

ACA Aponix Director Pascal Busnel on the most common cybersecurity myths that may cause firms to spend resources where they may not be needed.

The Hidden Costs of Non-Compliance

Proskauer law firm partner and former SEC Division of Investment Management deputy director Robert Plaze on why the costs of non-compliance go way beyond an SEC penalty.

CCO Liability: How to Protect Yourself

Find out from Blue Edge Capital CCO Margaret Fretz what chief compliance officers may be liable for and best practices to make sure you are protected.

Ethics or Compliance: Making the Choice

Find out the difference an ethics, rather than a compliance, perspective makes at an advisory firm from former Ethics and Compliance Officer Association COO Timothy Mazur.