Financial Regulatory Forum

New regulations require cleaner data

By Mark Davies, contributing author for Compliance Complete

LONDON, Apr. 18 (Thomson Reuters Accelus) – Continuing efforts by financial regulators and by firms themselves to monitor and offset risk have affected almost all areas of firms’ operations, including the management and maintenance of data. The overhaul of global systems following the financial crisis has led to an audit of data, and specifically of the information which firms hold about themselves and their counterparties or clients, known as business entity reference data.

More regulation

This “data exploration” is being driven by the cumulative effect of several individual pieces of regulation, including the European Market Infrastructure Regulation (EMIR) and Solvency II in Europe and the Dodd-Frank Act and the Foreign Account Tax Compliance Act (FATCA) in the U.S., all of which are likely to have an impact globally. The primary goal of these proposals, with the exception of FATCA, is to improve risk management in the financial system.  (more…)

INTERVIEW: Board members are accountable for compliance, SEC’s di Florio says

By Emmanuel Olaoye

WASHINGTON, Aug. 31 (Thomson Reuters Accelus) – Directors who fail to take an interest in compliance risk the threat of enforcement action from the Securities and Exchange Commission, a top official from the agency said.

In an interview with Thomson Reuters, Carlo di Florio, director of the SEC’s Office of Compliance Inspections and Examinations, said the agency was focused on developing an examination regime that looked at a company’s culture of compliance at every level of management. Board members who are not engaged in the compliance process risk the chance of their firm being referred to the SEC’s enforcement division for fraud or compliance failures. (more…)

Corporate investigations are getting riskier and more difficult, experts say

By Stuart Gittleman

NEW YORK, May 29 (Thomson Reuters Accelus) - U.S. corporate officers and directors are increasingly concerned over the business and legal challenges their entities face from potential securities enforcement and criminal probes, lawyers and corporate officers are saying.

A program last week analyzed how directors, executives and corporate counsel can appropriately manage the business and legal risks of an enforcement proceeding arising from earnings misstatements or employee misconduct at both low and high levels.  (more…)

SOPA, FATCA and the Volcker Rule: the border busters

By John Mackie (Canada)

(Business Law Currents) – The global nature of business has perhaps never been more evident than in the wake of the U.S. housing crisis, the natural disasters in Japan and the ongoing European sovereign debt ruckus. Industries and national economies do not exist in a vacuum, nor do the regulatory changes which nations seek to implement in order to address widespread concerns.

The most recent example of the “extraterritorial” impact of a nation’s laws is a rule being promulgated under the Dodd-Frank Wall Street Reform and Consumer Protection Act (the Dodd-Frank Act). Released last October, the Volcker rule is a proposal to prohibit proprietary trading and hedge or private equity fund investments by banking entities. (more…)

Peer to peer lending: the murky future with America’s new consumer protector

By Alex Lee

NEW YORK, Jan. 25 (Business Law Currents) - With the promise of high yields, peer to peer lending is attracting record amounts from institutional investors and individual lenders alike, even in the face of a cloudy regulatory future. Potential uncertainty aside, the attraction of an estimated $2.5 trillion industry is proving too hard to pass up for investors. The two largest P2P lending companies, LendingClub and Prosper have funded loans so far to the tune of over $480 million and $290 million respectively.

By way of background, peer to peer (P2P) lending microcredit institutions sprang up in 2005 in order to provide needy borrowers with viable alternatives to normal commercial bank loans. This industry had as its backbone, the seemingly novel concept of stripping out intermediaries, such as banks, and allowing lenders and borrowers to connect to reach their own financial terms for loans via the internet. The nascent industry made significant strides when even credit-worthy borrowers were locked out of the commercial credit markets due to the credit crisis. (more…)

On the other hand: When Woodstock meets Wall Street

By Scott McCleskey

Nov. 29 (Thomson Reuters Accelus) - If you didn’t know any different, you’d think the Occupy Wall Street movement was the kind of military operation so often criticized by people of a certain political temperament. It started off with a clear mission (financial reform), then suffered from mission creep (economic justice) and it never had an exit strategy. I think there was a surge in there somewhere as well but it’s hard to tell when they all live in tents.

The shame is that they had a point, in the beginning. Reforming the financial system is a gravely serious priority that is losing momentum. But by opening its arms to all who feel oppressed, repressed or suppressed, the inevitable result of the Occupy movement was that the original issue was lost in the noise. And as the movement begins to wind down it is likely to miss its greatest opportunity – to become the Tea Party of the Left.

Love ‘em or hate ‘em, the Tea Party has been successful in grabbing the microphone and framing much of the conservative agenda. It may represent only a minority of Republican voters, but it will undoubtedly influence the outcome of the party’s nomination process and its 2012 platform. It does so by focusing on a few core issues, and has accomplished all this without an organized structure or dominant leader.

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