Financial Regulatory Forum

Spoofing or just fast trading? Chicago case helps unwrap mystery

By Guest Contributor
November 19, 2015

By Richard Satran, Regulatory Intelligence

NEW YORK, (Thomson Reuters) – Compliance professionals were startled when a jury in the futures industry’s home base of Chicago convicted a veteran commodities trader of “spoofing,” a crime punishable by up to 25 years in prison but involving a kind of market manipulation once thought too vaguely defined to be prosecuted. It was surprising that a case of such complexity could be brought to such a conclusion, even more that jurors took just an hour of deliberation to do so.

IMPACT ANALYSIS: Ontario regulator’s review cites suitabilty, know-your-customer lapses at exempt market dealers

By Guest Contributor
November 17, 2015

By Helen Chan, Regulatory Intelligence

ONTARIO, Canada (Thomson Reuters) – The Ontario Securities Commission has highlighted Know-Your-Customer (KYC) deficiencies as one of the significant compliance problems facing exempt-market dealers in Ontario. The annual report by the OSC’s Compliance and Registrant Registration branch (CRR) of the Ontario Securities Commission signals that the market regulator of Canada’s financial capital is becoming increasingly more concerned that inadequate KYC efforts by registrants is leading to exempt securities being sold to investors who fail to qualify under a prospectus exemption. (more…)

COMMENTARY: SEC needs scalpel instead of chainsaw in revising beneficial ownership rules

By Guest Contributor
October 29, 2015

By Lawrence Hsieh, Practical Law

The U.S. Securities and Exchange Commission is considering whether and how to stop the regulatory arbitrage by shareholder activists of gaps in Securities Exchange Act disclosure requirements, which activists have exploited to gain significant stakes in public companies before incumbent management notices. Shareholders may be best served if the SEC takes a scalpel rather than a chainsaw to address the issue. (more…)

UPDATED: IMPACT ANALYSIS: Saba Capital sued by investor over valuation practices; is SEC next?

By Guest Contributor
October 20, 2015

By Todd Ehret, Regulatory Intelligence

NEW YORK, (Thomson Reuters) – A recent U.S. lawsuit filed by the Public Sector Pension Investment Board of Canada against hedge fund manager Saba Capital Management has drawn attention to fund valuation procedures.

The growing role of the insurance compliance officer

September 24, 2015

The role of the insurance compliance officer has evolved from a purely advisory role into a proactive one with internal audit characteristics in the last few years according to a white paper by Ethical Corporation, a global business publication.  (more…)

COMMENTARY: ‘Get tough’ law enforcement needs ‘get tough’ governance, too

By Guest Contributor
September 23, 2015

By Scott McCleskey, Regulatory Intelligence Expert

NEW YORK, Sept. 23, 2015 – The U.S. Justice Department’s initiative to focus on individual culpability in corporate crimes is long overdue and holds the potential, if vigorously pursued, to put teeth into efforts to enforce the law by deterring criminal activity. There are costs and perils to this approach, but the continuing litany of corporate misbehavior despite rising corporate fines suggests that other approaches have been less than effective. (more…)

Promontory, by settling, bows to realities of legal challenges against regulators

August 25, 2015

In a swift reversal of its earlier determination to sue the New York State Department of Financial Services, the Promontory Financial Group, a leading consultant to the industry, took what some observers say is the kind of advice it typically offers clients when accused of wrongdoing: settle. (more…)

IA BRIEF: The state of adviser social media compliance in the U.S.

August 10, 2015

In the past year compliance professionals have been preoccupied with preventing cybercrime, and rightfully so, with recent high-profile cyber attacks and increased regulatory attention. However, the compliance implications of social media in the financial services sector remain an evolving trend as well, with high importance. A recent investment adviser survey offers a glimpse at the state of the current adviser programs while exposing new risks.

Global finance leaders to banks: reform culture and conduct or face more regulation

August 3, 2015

A number of the world’s largest banks are still failing to implement much needed cultural and conduct reforms in their businesses, and a failure to do so could spur more government regulation, a long awaited report by the Group of Thirty (G30) forum of international finance leaders said on Thursday.

COLUMN: “Swindle & Fraud” – America’s great tradition, from Lapham’s Quarterly

June 16, 2015

It is easy to fall into the belief that we are living in special times; that greed, avarice, fraud, and swindle are at new heights; that bankers are worse than they’ve ever been; that public trust in them is at historic lows. Nearly every day we learn of yet another major fine imposed on a bank for some wrongdoing, all this while the leaders of finance lament the burdensome rules they must now work under.
Pity them, and pity us, but life has always been that way, or at least that is the lesson drawn in reading the latest edition of Lapham’s Quarterly “Swindle & Fraud.” We are reminded that humans have a long history of behaving badly, and efforts to change that reality have usually run aground. Deception, lies, fraud and confidence tricksters are part of our fabric, whether in business or finance, on a New York street corner, Barnum’s circus, or ancient Greece. (more…)