Corporate & Financial Weekly Digest

Corporate & Financial Weekly Digest

Tag Archives: SEC

FINRA Requests Comment on Proposed Pilot Program to Study Changes to Corporate Bond Block Trade Dissemination

Posted in Broker-Dealer
On April 12, the Financial Industry Regulatory Authority (FINRA) published a regulatory notice (the “Notice”) requesting comment on a proposed pilot program to study proposed changes regarding corporate bond block trade dissemination based upon recommendations by the Fixed Income Market Structure Advisory Committee (FIMSAC) of the Securities and Exchange Commission. The changes are aimed at… Continue Reading

SEC Approves FINRA Rule Change to Permit the Use of Electronic Signatures for Discretionary Accounts

Posted in Broker-Dealer
The Securities and Exchange Commission has approved a proposed rule change to amend Financial Industry Regulatory Authority (FINRA) Rule 4512 (Customer Account Information) (the “Amended Rule”). For discretionary accounts, member firms are currently required to maintain a record of the dated, manual signature of each named, natural person authorized to exercise discretion in such accounts.… Continue Reading

SEC Adopts Rules to Modernize and Simplify Disclosure

Posted in SEC/Corporate
The Securities and Exchange Commission recently adopted final rules to modernize and simplify the disclosure requirements for public companies under Regulation S-K. This rulemaking was mandated by the Fixing America’s Surface Transportation Act (FAST Act), and the final rules are substantially in the forms originally proposed by the SEC in October 2017 (as discussed in… Continue Reading

FINRA Proposes Rule Extending the Market-Wide Circuit Breakers in NMS Stocks Pilot Program

Posted in Broker-Dealer
On April 5, the Financial Industry Regulatory Authority filed with the Securities and Exchange Commission a proposed rule change to extend the pilot program related to FINRA Rule 6121.02 (Market-wide Circuit Breakers in NMS Stocks), which provides a methodology for determining when to halt trading in all national market system stocks due to extraordinary market… Continue Reading

FINRA Proposes Rule Extending the Pilot Program Related to Exchange-Listed Securities

Posted in Broker-Dealer
On April 5, the Financial Industry Regulatory Authority filed with the Securities and Exchange Commission a proposed rule change to extend the pilot program related to FINRA Rule 11892 (Clearly Erroneous Transactions in Exchange-Listed Securities). In September 2010, the SEC approved, on a pilot basis, changes to the rule that, among other things: (i) provided… Continue Reading

FINRA Proposes Rule Addressing Regulation NMS and Extraordinary Market Volatility

Posted in Broker-Dealer
On April 11, the Financial Industry Regulatory Authority filed with the Securities and Exchange Commission a proposed rule change to adopt FINRA Rules 6190 (Compliance with Regulation NMS Plan to Address Extraordinary Market Volatility) and 6121.01 (Resumption of Trading in Securities Subject to the Regulation NMS Plan to Address Extraordinary Market Volatility), which implement the… Continue Reading

FINRA Proposes Rule Making Substantive, Organizational and Terminology Changes to the Corporate Financing Rule

Posted in Broker-Dealer
On April 11, the Financial Industry Regulatory Authority filed with the Securities and Exchange Commission a proposed rule change to make certain substantive, organizational and terminology changes to FINRA Rule 5110 (Corporate Financing Rule – Underwriting Terms and Arrangements), which requires member firms that participate in a public offering to file documents and information with… Continue Reading

FCA and SEC Sign Updated Memoranda of Understanding

Posted in Brexit, Brexit/UK Developments, Derivatives, Financial Markets, SEC/Corporate, UK Developments
On March 29, the UK Financial Conduct Authority (FCA) issued a press release announcing that it has signed two updated memoranda of understanding (MOUs) with the Securities and Exchange Commission. Both MOUs aim to ensure the continued ability of the United Kingdom and the United States to cooperate and consult with each other regarding the… Continue Reading

Nasdaq Proposes Rule Change to SEC to Assume Operational Responsibility for Certain Investigation and Enforcement Functions Currently Performed by FINRA

Posted in Broker-Dealer
On April 3, the Securities and Exchange Commission published a notice to solicit comments on Amendment No. 2 to a proposed rule change filed by the Nasdaq Stock Market LLC, pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934. The SEC also approved the proposed rule change, as modified by Amendment No. 2,… Continue Reading

SEC Releases Framework for “Investment Contract” Analysis of Digital Assets

Posted in Broker-Dealer, Digital Assets and Virtual Currencies
Recognizing the need for guidance as to the application of US federal securities law for those considering an Initial Coin Offering (ICO), or otherwise engaging in the offer, sale or distribution of a digital asset, the Securities and Exchange Commission released its Framework for “Investment Contract” Analysis of Digital Assets. The Framework represents the views… Continue Reading

SEC Issues TurnKey Jet, Inc. No-Action Letter

Posted in Broker-Dealer, Digital Assets and Virtual Currencies
On April 3, the Securities and Exchange Commission’s Division of Corporate Finance (the “Division”) responded to TurnKey Jet, Inc.’s (TKJ) letter dated April 2, requesting confirmation that the Division would not recommend enforcement action to the SEC in connection with its offer and sale of tokens without registration under the Securities Act of 1933 and… Continue Reading

FINRA Proposes Data Service for Corporate Bond New Issues

Posted in Broker-Dealer
The Financial Industry Regulatory Authority (FINRA) has filed with the Securities and Exchange Commission a proposed rule change to establish a new issue reference data service for corporate bonds. FINRA currently requires underwriters of initial offerings for corporate bonds to submit information relating to the bonds to FINRA under Rule 6760. This information is limited… Continue Reading

FINRA Issues Guidance on FOCUS Reporting for Operating Leases

Posted in Broker-Dealer
On March 19, the Financial Industry Regulatory Authority, Inc. (FINRA) released Regulatory Notice 19-08 to provide guidance to members for reporting lease assets and liabilities on their FOCUS reports. FINRA’s notice follows an October 2018 No-Action Letter (the No-Action Letter) in which the staff of the Securities and Exchange Commission’s Division of Trading and Markets… Continue Reading

FINRA Files Proposed Rule Change to CAB Rules Governing Qualification, Registration and Continuing Education of Associated Persons of CABs

Posted in Broker-Dealer
The Financial Industry Regulatory Authority (FINRA) is filing with the Securities and Exchange Commission a proposed rule change to amend the Capital Acquisition Broker (CAB) Rules governing the qualification, registration and continuing education of associated persons of CABs (CAB Rules 119-125). The proposed rule change reflects new consolidated FINRA qualification and registration rules and changes… Continue Reading

Report from FINRA Board of Governors Meeting: Board Approves Rule Proposals, Engages with Boca Raton-Area Firms

Posted in Broker-Dealer
The Board of Governors of the Financial Industry Regulatory Authority (FINRA) met on February 28 and March 1 in Boca Raton, Florida, where it discussed the organization’s finances, reviewed several significant technology and other capital initiatives, and considered certain rulemaking items.… Continue Reading

SEC Chairman Clayton and Trading and Markets Director Redfearn Call for a Reassessment of Regulation NMS

Posted in Broker-Dealer
On March 8, US Securities and Exchange Commission chairman Jay Clayton and director, Division of Trading and Markets Brett Redfearn gave a speech entitled “Equity Market Structure 2019: Looking Back & Moving Forward.” Chairman Clayton, who noted that their comments were their own and not necessarily those of the SEC or its staff, opined that… Continue Reading

SEC Examines Stock Exchange Pricing

Posted in Broker-Dealer
The US Securities and Exchange Commission has begun looking into whether the current multi-tiered pricing system used by stock exchanges favors large brokers and traders at the expense of small ones. In an effort to increase the volume of trading on an exchange, certain exchange operators (including New York Stock Exchange-owner Intercontinental Exchange Inc., Nasdaq… Continue Reading

SEC Proposes To Expand “Test-the-Waters” Reforms to All Issuers

Posted in SEC/Corporate
On February 19, the Securities and Exchange Commission proposed Rule 163B under the Securities Act of 1933, which would permit any issuer, and any underwriter or other person acting on an issuer’s behalf, to communicate with qualified institutional buyers (QIBs) and institutional accredited investors (IAIs) regarding a potential public offering prior to or following the… Continue Reading

SEC Issues C&DI on Disclosure of Self-Identified Director Diversity Characteristics

Posted in SEC/Corporate
On February 6, the staff of the Division of Corporation Finance of the Securities and Exchange Commission released two identical Compliance and Disclosure Interpretations (C&DIs). These C&DIs provide guidance on disclosure required under Items 401 and 407 of Regulation S-K in circumstances where a director or board nominee self-identifies specific diversity characteristics, such as race,… Continue Reading

SEC and New Jersey US Attorney’s Office Bring Parallel Charges in EDGAR Hacking Scheme

Posted in Broker-Dealer
On January 15, the Securities and Exchange Commission announced charges against nine defendants, alleging their participation in a previously disclosed scheme to hack into the SEC’s EDGAR system and extract nonpublic information to use for illegal trading. The SEC charged a Ukrainian hacker, six individual traders in California, Ukraine and Russia, and two entities. In… Continue Reading

SEC Adopts Final Rules for Disclosure of Hedging Policies

Posted in SEC/Corporate
The Securities and Exchange Commission recently announced that it had at last adopted final rules to implement Section 14(j) (Disclosure of Hedging by Employees and Directors) of the Securities Exchange Act of 1934, which was enacted in 2010 by the Dodd-Frank Wall Street Reform and Consumer Protection Act. New Item 407(i) of Regulation S-K will… Continue Reading

SEC Announces Examination Priorities for 2019

Posted in Broker-Dealer
On December 20, the Office of Compliance Inspections and Examinations (OCIE) of the Securities and Exchange Commission announced its 2019 examination priorities. This year, OCIE’s examination priorities are divided into six categories: examining compliance and risk in registrants responsible for critical market infrastructure; protecting retail investors, including seniors and those saving for retirement; continuing oversight… Continue Reading

FINRA Files Proposed Rule Change Regarding Arbitration Subpoenas, Orders of Appearance of Witnesses and Production of Documents

Posted in Broker-Dealer
On December 20, the Financial Industry Regulatory Authority filed a proposed rule change with the Securities and Exchange Commission to amend various FINRA Code of Arbitration Procedure Rules that govern objections in arbitration proceedings to subpoenas, orders of appearance of witnesses and production of documents by non-parties. Since non-parties to a FINRA arbitration do not… Continue Reading

SEC Adopts Transaction Fee Pilot for NMS Stocks

Posted in Broker-Dealer
On December 19, the US Securities and Exchange Commission announced that it had voted to conduct a Transaction Fee Pilot in national market system (NMS) stocks, following a recommendation from the Equity Market Structure Advisory Committee. The SEC is initiating the Pilot to study the effects of exchange transaction fee and rebate pricing models on… Continue Reading