Securities and exchange commission

The U.S. Securities Exchange Commission (SEC) Enforcement Division altered the jet stream of blogosphere commentary last December by, for the first time, recommending legal action against a CEO on account of a Facebook post. Immediately after the announcement, a blizzard of articles, tweets, and blogs buried the mediascape with opinions about the critical role of CEO social media use in the new economy, the wisdom or foolishness of allowing CEO's to Tweet or post, and whether the SEC should be time warped back to the Stone Age it seems to prefer.Sweeping away the accumulated hyperbole reveals two important takeaways from the SEC's announcement, applicable to both public and private companies: i) the more things change, the more they remain the same, and ii) this latest "grave threat" to the modern world is not a crisis, but an opportunity. Social media can be a valid, legal, and effective way to communicate with investors, if it's done right.About Regulation FDThe SEC's action … [Read more...] about Protect Your CEO’s Tweets and Posts from U.S. Securities Exchange Commission (SEC) Enforcement Action

Since the inception of the federal securities laws in the 1930s, a basic rule has been, absent registering with the Securities Exchange Commission (SEC) (and/or the state equivalent of the SEC), companies may not conduct general solicitations of the offerings of securities. This includes not making private placement memoranda or other offering documents on a company’s website. In 2012, Congress passed and the President signed the JOBS Act which instructed the SEC to create rules to allow general solicitation to accredited investors.On July 10, the SEC issued these rules, as Rule 506(c) of Regulation D of the Securities Act of 1933. These new rules are scheduled to become effective 60 days after their publication.The first thing to note is that while Rule 506(c) provides a new way to raise risk capital without running afoul of the SEC, it does not eliminate or change any of the ways that have previously existed and used for years. Issuers now will have a new option, one that … [Read more...] about Securities Exchange Commission’s (SEC) New General Solicitation Rules Are Here

Since the inception of the federal securities laws in the 1930s, a basic rule has been, absent registering with the Securities Exchange Commission (SEC) (and/or the state equivalent of the SEC), companies may not conduct general solicitations of the offerings of securities. This includes not making private placement memoranda or other offering documents on a company’s website. In 2012, Congress passed and the President signed the JOBS Act which instructed the SEC to create rules to allow general solicitation to accredited investors. On July 10, the SEC issued these rules, as Rule 506(c) of Regulation D of the Securities Act of 1933. These new rules are scheduled to become effective 60 days after their publication.The first thing to note is that while Rule 506(c) provides a new way to raise risk capital without running afoul of the SEC, it does not eliminate or change any of the ways that have previously existed and used for years. Issuers now will have a new option, one that … [Read more...] about The Securities Exchange Commission (SEC) New General Solicitation Rules Are Here

The US District Court for the Middle District of Louisiana granted the United States’ motion to dismiss a putative class action law suit against the Securities Exchange Commission. Plaintiffs brought the suit under the Federal Tort Claims Act (FTCA) on behalf of victims who lost their investments in the Stanford International Bank, Ltd. (SIBL) Ponzi scheme. Plaintiffs alleged that the SEC failed to investigate the SIBL scheme and thereby contributed to plaintiffs’ loss. The United States moved to dismiss for lack of subject matter jurisdiction, arguing that the SEC’s actions fell within the “discretionary function” exception to the FTCA. Pursuant to the FTCA, a plaintiff can sue a government agency or employee who commits negligent or wrongful acts where the suit would otherwise be barred by sovereign immunity. The “discretionary function” exception removes from the ambit of the FTCA situations in which agencies or employees exercise … [Read more...] about District Court Dismisses Class Action Suit Under Federal Tort Claims Act (FTCA) Against Securities Exchange Commission (SEC)

On March 12, the Securities and Exchange Commission voted to propose new rules that would enhance the oversight of registered clearing agencies that: (1) have been designated as systemically important by the Financial Stability Oversight Council and for which the SEC is the supervisory agency pursuant to the Clearing Supervision Act; (2) provide central counterparty services for security-based swaps or are involved in activities the SEC determines to have a more complex risk profile, where in either case the Commodity Futures Trading Commission is not the supervisory agency for such clearing agency (as defined in Section 803(8) of the Clearing Supervision Act); or (3) are otherwise determined to be covered clearing agencies by the SEC  (Covered Clearing Agencies). These proposed rules would establish more robust requirements for Covered Clearing Agencies and would apply the existing rules for all other registered clearing agencies. Entities operating pursuant to an exemption from … [Read more...] about Securities & Exchange Commission (SEC) Proposes Rules to Enhance Oversight of Clearing Agencies