Companies should use metrics to defend themselves from Dodd-Frank whistleblower claims, report says
NEW YORK, March 5 (Thomson Reuters Accelus) - Companies in the United States should focus on implementing performance metrics to defend themselves from whistleblower claims and to prevent misconduct within the company, according to a report from consultancy PricewaterhouseCoopers.
Using metrics such as the turnover of compliance staff and the percentage of anonymous reports can help a company monitor the performance of its compliance program. It can also help to reduce the chances of an employee reporting misconduct directly to the Securities and Exchange Commission, PwC said in the report, which is an analysis of whistleblower rules included in the Dodd-Frank regulatory overhaul and adopted last May by the SEC. (more…)
Global regulation 2011: a review of policies that shaped the business world
Jan. 10 (Business Law Currents) — Global regulators have been anything but idle in 2011. Predictably, the U.S. regulatory landscape was dominated by the 800-lb. statutory gorilla, the Dodd-Frank Act. Canada busied itself trying to accommodate Basel III’s coming capital requirements. Anti-bribery regulation managed to elbow its way into UK headlines in spite of a phone hacking scandal and a royal wedding. China cracked down on loopholes for variable interest entities, while Australia’s new tax regime found few friends in the mining sector down under. (more…)
U.S. financial services can expect more Dodd-Frank in 2012, not less
By Rachel Wolcott
NEW YORK, Dec.16 (Thomson Reuters Accelus) – When congressman Barney Frank announced he would not seek another term, enemies were quick to predict the demise of the wide-ranging financial reform act that the Massachusetts Democrat penned with former Connecticut Senator Chris Dodd. These pronouncements are not just premature, but according to regulatory experts, probably wrong. Unless there is a real seismic political shift to the right after the 2012 elections, they say, the Dodd-Frank Wall Street Reform and Consumer Protection Act 2010 will survive, perhaps with a little tinkering, and firms had better be prepared to deal with it.
Dodd-Frank will only face a real threat if the Republicans take the White House and a majority in the U.S. Senate, while hanging on to the House of Representatives. Right now, with former House Speaker Newt Gingrich the latest to surge to the top of the Republican pack of presidential candidates, the likely outcome of November presidential elections is far from clear. If President Barack Obama, who signed Dodd Frank into law, stays in office, he can use his veto power to try to protect Dodd-Frank. (more…)
Delay in U.S. consumer bureau authority spares non-bank lenders
By Ted Knutson
WASHINGTON, July 21 (Thomson Reuters Accelus) – A political stalemate over the consumer protection bureau created under the Dodd-Frank financial regulation overhaul is allowing payday loan firms and other non-bank lenders to escape the agency’s authority for now, but industry participants say they have nonetheless boosted lending and disclosure standards.
Institutions including non-bank mortgage companies, student loan providers and payday lenders, and their trade organizations discussed their views with Thomson Reuters before Thursday’s official launch of the Consumer Financial Protection Bureau.
Once in a while, individuals run out of cash. The bills will still come. Would you rather pay overdraft charges or get a payday loan? Answering the issue is easy. It won’t take a lot of effort. Credit scores are more easily hurt by overdraft charges. That means getting a pay day loan, which is also cheaper usually, is the better decision. It will keep your credit secure and keep your financial institution happy with you. You can learn more. Just go to: https://personalmoneynetwork.com/payday- loans/
The Rajaratnam Verdict: Tip of the Iceberg – ANALYSIS
NEW YORK, May 18 (Business Law Currents) – The U.S. Securities and Exchange Commission’s trophy case gets a new addition with the conviction of Raj Rajaratnam, but shelf room is still available.
For all its publicity, the Rajaratnam case was merely one of many; since late 2009, insider trading probes related to Galleon have resulted in 13 additional guilty pleas. In recent months, some of the country’s most prestigious names have been linked to what appears to be a widening net of scandals. Fallout from these and others yet to be named should continue to generate headlines for the foreseeable future. (more…)
Private placements and conflicts of interest: do consenting adults need more protection? – COLUMN
By Helen Parry, Thomson Reuters Accelus regulatory intelligence expert. The views expressed are her own.
LONDON, May 16 (Thomson Reuters Accelus) -
“The first private placement memorandum disclosed the possibility that new investors may help pay distributions to old investors but this was not a risk; it was a certainty.” (US Securities and Exchange Commission v Bravata 2011 WL 339458.)
“This disclosure indicates that GSI may invest in securities that are ‘adverse to’ the Hudson investments … Goldman had already determined to keep 100 per cent of the short side of the Hudson CDO.” U.S. Senate Investigations Subcommittee Levin-Coburn Report on the Financial Crisis.
The fact that investors in the Billionaire Boys Club property investment Ponzi scheme, the subject of the Bravata case quoted above, blithely handed over their hard-earned cash, despite the fact that the private placement memorandum disclosed that it may be just that, is a striking example of the dangers that may befall unwary investors who fail to check the small print.
Nevertheless, although disclosing the fact that one might be operating a Ponzi scheme or a conflicted interest may not suffice to protect one from potential liability for misrepresentation or fraud if one has already determined to engage in such a course of action, disclosing such matters when one is yet to make such a determination and the statement is, therefore, true, may do the trick, at least in the case of the collateralized debt obligation (CDO). (more…)
Dodd-Frank’s hatchet men: SEC & others go after incentive-based compensation
March 8 (Westlaw Business) – Can Dodd-Frank’s latest anti-risk salvo, a new proposed rule on incentive-based compensation, solve as many questions as it raises? In theory, the idea is a noble one: break the chain of managing for the short-money by curtailing lopsided risks that ultimately soak the taxpayer. But even the SEC and the other agencies involved under the new Dodd-Frank regime admit there will be no shortage of questions.
Section 956 of the Dodd-Frank Wall Street Reform and Consumer Protection Act lays the groundwork for the regulation of incentive-based compensation. The statute formally rejects the idea that it “require[s] the reporting of the actual compensation of particular individuals;” likewise, the statute’s scheme thus offered does not apply to otherwise covered institutions lacking incentive-based compensation packages. (more…)
COLUMN-Two paths to failure on Dodd-Frank
(Scott McCleskey is a managing editor for the ThomsonReuters Governance, Risk and Compliance unit. The views expressed are his own)
By Scott McCleskey
NEW YORK, Feb. 14 (Complinet) – With all the chest-thumping about U.S. financial reform last year, you would suppose that the regulatory authorities responsible for implementing the provisions of the Dodd-Frank Act would now have the political wind at their back.
This is particularly the case given the tight deadline for most of the provisions — on or before the July 21 anniversary of the Act’s enactment. You would be wrong. Both sides of the aisle in Congress have taken or threatened steps which only serve to undermine the process of regulatory reform and leave the market with all the costs and none of the benefits of reform. (more…)
SEC whistleblower rules raise risk for companies, lawyers say (Complinet)
By Emmanuel Olaoye
NEW YORK, Feb. 2 (Complinet) Proposed increases in federal rewards for whistleblowers who report securities violations to the Securities and Exchange Commission raise the risk that employees will go outside their firms to report trouble, according to industry officials. Firms can avoid being the victims of potential whistleblowers by better publicizing their internal channels for reporting wrongdoing and getting creative with incentives for using them, they said. (more…)
U.S. corporate shareholders gain more (frequent) say-on-pay (Westlaw Business)
By Erik Krusch
Feb. 2 (Westlaw Business) – Dodd-Frank and SEC-bolstered shareholders officially have a say on company pay. The SEC recently adopted rules requiring companies to hold say-on-pay, say-on-pay frequency, and golden parachute approval votes. Companies from Deere & Co. and Apple to Johnson Controls and Monsanto’s proxies are drafted, filed and poised to comply with the new rules. Companies and shareholders, however, still have plenty to hash out around the mechanics of executive compensation votes this proxy season. (more…)
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