Posts in Securities and Exchange Commission (SEC).
Internal Control Failures Cost MetLife $10 million in SEC Settlement

MetLife, Inc. has agreed to pay a civil penalty of $10 million in order to settle charges from the Securities and Exchange Commission (“SEC”) that it violated the books and records and internal accounting controls provisions of the federal securities laws.

Another Technology Company Settles SEC Charges Over ICO Violations

Blockchain of Things (“BCOT”), a technology company, has agreed to settle charges with the Securities and Exchange Commission (“SEC”) for conducting an initial coin offering (ICO) without registering it as a securities offering or qualifying for any registration exemptions.  The settlement requires BCOT to agree to a cease and desist order, pay a $250,000 civil fine, return funds to any investors who file a request, and register the tokens as securities.

SEC Proposes Updated Definition of Accredited Investor, Qualified Institutional Buyer

The Securities and Exchange Commission (“SEC”) voted to propose amendments to its definition of an “accredited investor,” which, if approved, will allow more investors access to invest in private offering opportunities.

Inside the SEC’s Proposed New Rules for Financial Advisor Advertising

Advisory firms are encountering more competition than ever when it comes to building their client base. Many firms would make an additional spend on marketing and advertising strategies (including use of solicitors and social media to attract younger clients) but often are concerned about SEC regulatory scrutiny and limitations imposed on registrants.

A Costly Failure to Follow Written Policies and Procedures

On November 22, 2019, the Securities and Exchange Commission ("SEC") ordered Channing Capital Management, LLC ("Channing"), a registered investment adviser located in Illinois, to pay a $50,000 civil penalty for failure to enforce its own written policies and procedures. This specific case underscores the importance of following the safeguards you put in place to protect all clients at all times.

SEC Proposes Exemptions to Application Procedures

The Securities and Exchange Commission (“SEC”) has announced that it voted to establish an expedited review process for Investment Company Act applications that are substantially identical to recent precedent. Intended to make the application process more efficient by streamlining the process for routine applications and reduce the likelihood that applicants would need to file amendments to applications in response to staff comments.

SEC Requests Proposals to Innovate Markets for Thinly Traded Securities

The Securities and Exchange Commission (“SEC”) is considering implementation of regulatory changes in order to improve secondary market structures for thinly traded securities. It has announced a request for exchanges, issuers, investors, or other market participants to submit proposals that will facilitate market structure innovations that would meaningfully enhance trading.

PricewaterhouseCoopers LLP pays $7.9 to Settle SEC Improper Professional Conduct, Auditor Independence Charges

PricewaterhouseCoopers LLP has agreed to pay over $7.9 million to settle charges brought by The Securities and Exchange Commission (“SEC”). The SEC charges alleged that PwC, and its partner Brandon Sprankle, had engaged in improper professional conduct on 19 engagements on behalf of 15 audit SEC-registered issuers and violating auditor independence by performing non-audit services during an audit engagement.

HCR Advisors Settles SEC Charges on Failure to Supervise and Implement Compliance-Related Policies and Procedures

HCR Wealth Advisors agreed to a cease-and-desist order, a $220,000 penalty, and a $328,912 payment to its harmed clients in order to settle charges with the U.S. Securities and Exchange Commission (“SEC”). The SEC complaint alleged that HCR had failed to reasonably supervise and implement its own compliance-related policies and procedures in response to fraudulent actions by one of its former investment advisors. 

Amadeus Wealth Advisors, Three Bridge Wealth Advisors Settle SEC Unlawful Proxy Charges

The Securities and Exchange Commission (“SEC”) has spent time and energy focused on proxy voting matters in the recent months. In August 2019, the SEC provided guidance (discussed below) to assist investment advisers fulfilling their proxy voting responsibilities. It also appears to have increased its attention toward regulatory actions involving proxy voting on behalf of clients. 

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