SEC NEWS

SEC charges 12 additional financial firms for failure to meet Form CRS obligations

On February 15, the SEC announced six investment advisers and six broker-dealers have agreed to settle charges that they failed to file and deliver client or customer relationship summaries, known as Form CRS.

Read the February 15 press release. .

SEC’s Small Business Capital Formation Advisory Committee meeting to explore small business investment issues

On February 10, the SEC’s Small Business Capital Formation Advisory Committee held a meeting to explore small business investment issues, including the impact of updates to the financial thresholds in the accredited investor definition, and how the accredited investor definition impacts capital raising opportunities for early-stage companies that raise capital in the exempt markets.

Read the February 7 press release announcing the meeting and the meeting agenda. .

Office of the Investor Advocate publishes its Report on Activities for Fiscal 2021

In February, the SEC’s Office of the Investor Advocate published its Report on Activities for Fiscal 2021.

Read the entire report as a downloadable PDF. .

SEC seeks candidates for Investor Advisory Committee

On January 19, the SEC announced it is seeking candidates for appointment to the Investor Advisory Committee to help protect investors and improve securities regulations.

Read the January 19 press release. .

SEC Rule Proposals

SEC proposes short sale disclosure rule, order marking requirement, and CAT amendments

On February 25, the SEC proposed new Exchange Act Rule 13f-2 and the corresponding Form SHO that would require certain institutional investment managers to report short sale related information to the SEC monthly. The SEC then would make aggregate data about large short positions, including daily short sale activity data, available to the public for each individual security. There is a 60-day public comment period.

Read the press release, fact sheet and proposed rules..

SEC proposes rule amendments to modernize beneficial ownership reporting

On February 10, the SEC announced proposed rules “to improve transparency and provide more timely information for shareholders and the market.” There is a 60-day public comment period.

Read the press release, fact sheet and proposed rule.

SEC issues proposal to reduce risks in clearance and settlement

On February 9, the SEC announced proposed rule changes to reduce risks in the clearance and settlement of securities to reduce the credit, market and liquidity risks in securities transactions faced by market participants and U.S. investors. There is a 60-day public comment period.

Read the press release, fact sheet and proposed rule.

SEC proposes cybersecurity risk management rules and amendments for registered investment advisers and funds

On February 9, the SEC announced proposed rules related to cybersecurity risk management, requiring advisers and funds to adopt and implement written cybersecurity policies and procedures. There is a 60-day public comment period.

Read the press release, fact sheet and proposed rule. .

SEC proposes new rules for private fund advisors

On February 9, the SEC announced new rules and amendments under the Investment Advisers Act of 1940 (Advisers Act) “to enhance the regulation of private fund advisers and to protect private fund investors by increasing transparency, competition and efficiency.”

Read the press release, fact sheet and proposed rule. .

FINRA

2022 Report on FINRA’s Examination and Risk Monitoring Program

On February 9, FINRA published its 2022 Report on its Examination and Risk Monitoring Program to provide firms with information that may help inform their compliance programs.

Read the FINRA report. .

FINRA adopts amendments to FINRA Rule 2165 (Financial Exploitation of Specified Adults)

FINRA has adopted amendments to Rule 2165 (Financial Exploitation of Specified Adults) to expand the standards for placing temporary holds to address suspected financial exploitation. The amendments become effective March 17, 2022.

Read Regulatory Notice 22-05 regarding the amendments to Rule 2165. .

Read the Frequently Asked Questions..

Department of Labor

DOL seeks public comment on climate-related financial risks

On February 11, the DOL announced publication of a Request for Information (RFI) seeking public comment on what actions, if any, the department should take to protect retirement savings and pensions from risks associated with changes in climate; the RFI follows President Biden’s Executive Order on Climate-Related Financial Risk.

Read the news release.

Read the February 14 Notice as a downloadable PDF. .

DOL issues report on default electronic disclosure

On January 26, the DOL published a report to Congress regarding the impact of the DOL’s 2020 electronic delivery regulation on individuals without web-based access. DOL’s preliminary assessment was that it “is unlikely to have any negative impact … because of the regulation’s specific safeguards...” However, they also said that due to other guidance (e.g., covid relief) “it would be premature and uninformative” to assess the overall regulation.

Read the report as a downloadable PDF. .