Search Results: Regulatory Guidance

SEC Proposes Rules that Could Regulate DeFi, Extend to Aspects of Centralized Crypto Exchanges

Here is a link to our client alert addressing the SEC’s proposed change to the “exchange” definition, including introduction of the new term “communication protocol system.” There were zero references to crypto, blockchain, DeFi, or distributed ledger technology in the 654-page proposal. Nevertheless, the proposal makes clear that it applies…

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SEC Eyeing Rulemaking to Combat Market Volatility, Modernize Market Structure

On January 26, 2022, SEC Chairman Gary Gensler issued a brief statement noting the agency’s efforts to address the market volatility in January 2021 and beyond.  The statement referenced the SEC staff report on volatility and market structure conditions and a request for comment related to digital engagement practices or…

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SEC to Propose Cybersecurity Risk Governance Disclosures—Commissioner Roisman Shares His Views

SEC Commission Elad Roisman recently spoke about cybersecurity threats and challenges facing the agency’s registrants, including public companies and financial institutions.  One source of challenges (our words, not Roisman’s) may come from the government itself—the combination of (1) the lack of clarity on requirements and expectations from the SEC in…

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Is the SEC Still Considering Fixes to the Bond Markets?

The SEC has made a concerted effort in recent years to look more closely at the fixed income markets.  But under the new leadership of Chairman Gary Gensler, that spotlight seemed to have dimmed—or so some thought. For example, FIMSAC—the Fixed Income Market Structure Advisory Committee—which the SEC convened in…

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SEC’s Gensler Shines Additional Light on Agency’s Focus

The SEC has been increasingly focused on digital engagement practices (DEPs) and gamification in the marketplace.  In August, for example, the SEC solicited public comment on broker-dealer and investment adviser DEPs and potential regulatory approaches in this area.  In October, SEC staff produced a report on “meme” stock events and…

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SEC Staff Issues Report on “Meme” Stock Events and Market Structure Considerations

The onset of fall signals a sad realization that summer has ended, but also the joy that “market structure” season has arrived for securities industry participants and policy wonks.  Right on cue, in early October, SEC staff issued a report on equity and option market structure conditions related to the…

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SEC Seeks Input on BD and RIA Digital Engagement Practices

The SEC recently solicited public comment on digital engagement practices (DEPs) used by some broker-dealers and investment advisers, including predictive data analytics, differential marketing, and behavioral prompts (such as gamification).  The public comment window closes October 1, 2021.  Comments letters submitted already are available here—viewpoints run the gamut and are…

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SEC Charges 27 Firms with Form CRS Failures

Word to the wise: when a regulator kindly reminds you on multiple occasions that you need to comply with its rules, you should probably heed those warnings.  On July 26, 2021, the SEC announced settlements with 21 investment advisers and 6 broker-dealers that apparently did just the opposite.  In particular,…

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Time’s Up! Broker-Dealers Must Comply with the Customer Protection Rule When Borrowing Customer Securities

On April 16, 2021, the staff of the SEC Division of Trading and Markets reminded broker-dealers borrowing fully paid and excess margin securities from their customers (FPL programs) that they are obligated to comply with Exchange Act Rule 15c3-3 (Customer Protection Rule), and in particular, paragraph (b)(3).  This reminder was…

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