Sarbanes-Oxley

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In December 2020, President Donald Trump signed into law the Holding Foreign Companies Accountable Act (the HFCAA). The HFCAA requires auditors of foreign companies that are publicly traded in the US to allow the Public Company Accounting Oversight Board (PCAOB) to inspect the auditors’ audit work papers for audits of non-US operations. If a company’s auditors fail to comply with the inspection requirement for three consecutive years, trading in such foreign company’s securities would be prohibited in US markets. The HFCAA also amends the Sarbanes-Oxley Act of 2002 (the Sarbanes-Oxley Act), mandates that the Securities and Exchange Commission identify foreign issuers that use an audit firm that is located in a foreign jurisdiction in which the PCAOB is restricted from inspecting or investigating the audit firm, and imposes additional SEC disclosure requirements on such foreign issuers.
Continue Reading Holding Foreign Companies Accountable Act Signed Into Law by President Trump

The Securities and Exchange Commission recently adopted amendments to the definitions of “Accelerated Filer” and “Large Accelerated Filer” in Rule 12b-2 of the Securities Exchange Act of 1934, as amended. The SEC originally proposed these amendments in May 2019, as summarized in a prior Corporate & Financial Weekly Digest article. As a result of these amendments, a greater number of smaller companies will be excluded from accelerated and large accelerated filer status, which will ease reporting burdens and reduce compliance costs for those companies.
Continue Reading SEC Amends the Definitions of “Accelerated Filer” and “Large Accelerated Filer”

In March 2017, the Government-Business Forum on Small Business Capital Formation of the Securities and Exchange Commission published its final report from the 2016 forum held on November 17, 2016. The forum is held annually “to provide a platform to highlight perceived unnecessary impediments to small business capital formation.” Each year the SEC’s Office of Small Business Policy (a part of the Division of Corporation Finance) invites federal government agencies, the North American Securities Administrators Association (consisting of state securities, or Blue Sky, regulators), and small business and professional organizations to participate in the forum, and each forum puts forth a list of recommendations to improve the capital formation process for small businesses.
Continue Reading Final Report Issued by SEC-Government-Business Forum on Small Business Capital Formation

On August 4, the Securities and Exchange Commission instituted cease-and-desist proceedings against Houston American Energy Corp., an oil and gas exploration and production company, and John F. Terwilliger, its CEO, for making fraudulent claims about the company’s oil reserves. According to the SEC, during late 2009 and early 2010, Houston American raised approximately $13 million …