Posts in Disclosures.
How a Popular Index’s Lack of Risk Disclosures Resulted in a Recent $9 Million SEC Fine: Lessons Learned

The absence of simple disclosure in a licensing agreement about an Auto Hold feature for a volatility index managed by S&P Dow Jones Indices (S&P DJI) prompted the U.S. Securities and Exchange Commission (SEC) to take action, further establishing a framework for index providers.

Posted in Disclosures
A Financial Advisory Firm’s Simple, but Costly Lesson in the Need for Adequate Fee Disclosure

When it comes to disclosure, it’s important to have more than one set of eyes review everything from marketing materials to Forms ADV to make certain all required language is included and nothing is overlooked. A recent regulatory filing underscores how a lack of disclosure and not having sufficient written policies and procedures in place to prevent such lapses can create unnecessary conflicts of interest, regardless of adviser intent.

Posted in Disclosures
California Governor Signs CCPA Amendments, Privacy Related Bills into Law

California Governor Gavin Newsom has signed five bills that will directly amend the California Consumer Privacy Act (CCPA). Signed into law by then-Governor Jerry Brown on June 28, 2018, the CCPA was designed to notify consumers that they can learn about their personal data that is being collected and sold or distributed to third-parties or affiliates and be given the opportunity to opt-out. The effective date of the CCPA is January 1, 2020, and the enforcement date will be on July 1, 2020.

OCIE Risk Alert: Guidance for Compliance, Supervisory and Disclosure Procedures

The Office of Compliance Inspections and Examinations (OCIE) released a risk alert outlining findings of examinations it conducted as part of its Supervision Initiative...

SEC Charges Investment Advisor with Defrauding Clients by Failure to Disclose Conflicts of Interest

One of the more complicated aspects of fiduciary responsibility rests with a firm's ability to adequately identify and disclose potential conflicts of interest. What may not appear to be a conflict can nevertheless violate securities laws whether it be a material misstatement or omissions in reports filed with the Securities and Exchange Commission (SEC).

Charging Clients Fees Not Disclosed in Form ADV: State Street Settles with SEC for $88 Million

The Securities and Exchange Commission ("SEC") announced it had settled charges against State Street Bank and Trust for overbilling mutual funds and other investment company clients by more than $170 million over a 17-year period.

The CFP's Revised Code of Ethics and Standards of Conduct Takes Effect

In late March, 2018, the Certified Financial Planner (CFP) Board of Standards announced the unanimous approval of a new Code of Ethics and Standards of Conduct.

This replaces the current Code of Ethics, Rules of Conduct, and Financial Planning Practice Standards and Terminology for all CFP-licensed professionals.

Posted in Disclosures
Protecting Retail Investors: Thoughts from SEC Director Peter Driscoll, OCIE

In a speech given in late April, Peter Driscoll, Director of the Office of Compliance Inspections and Examinations (OCIE), discussed the importance of cooperation among compliance officers, senior management, and the OCIE to promote compliance and more effectively protect...

Violating Auditor Independence Rules: Deloitte Japan Pays $2 Million

Deloitte Touche Tohmatsu LLC, commonly referred to as Deloitte Japan, has agreed to pay $2 million in settlement charges to the Securities and Exchange Commission ("SEC") for violating the SEC's auditor independence rules. According to the SEC, Deloitte Japan...

Posted in Disclosures

Dale Cebert was managing over $400 million when Morgan Stanley terminated his employment for failure to disclose his outside business activities. Being terminated is always a serious matter any investment professional, but allegations were also added to his public...

Posted in Disclosures

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