The SEC last month proposed rules under the Advisers Act indicating a dramatic shift in how the SEC intends to reduce conflicts of interest involving private fund managers and their investors. As we previously noted in the...more
5/3/2022
/ Anti-Fraud Provisions ,
Clawbacks ,
Conflicts of Interest ,
Fund Managers ,
Investment ,
Investment Adviser ,
Investment Advisers Act of 1940 ,
Investment Management ,
Investors ,
Private Funds ,
Proposed Rules ,
Regulatory Agenda ,
Regulatory Reform ,
Securities and Exchange Commission (SEC) ,
Securities Regulation
Last month, the SEC proposed new rules under the Advisers Act that, if implemented, would be the most significant enhancement of disclosure obligations for private fund managers since the Dodd-Frank Act.Citing investor...more
Over the past few years, the SEC has brought fewer insider trading and Material Non-Public Information (MNPI)-related cases compared to historical numbers. We expect to see a reversal of that trend in 2022.
The SEC has...more
2021 continued the trend of increased regulatory focus on privacy and cybersecurity for private investment funds in the U.S. and abroad. There are no signs of the trend leveling off any time soon. One of the topics that...more
Sanctions continue to be a dynamic area of regulation and enforcement. In its first year, the Biden Administration has already undertaken a number of different sanctions initiatives. The three examples below highlight the...more
3/9/2022
/ Anti-Corruption ,
Asset Management ,
Asset Seizure ,
Biden Administration ,
Economic Sanctions ,
Enforcement Priorities ,
Financial Transactions ,
Foreign Corrupt Practices Act (FCPA) ,
Foreign Policy ,
Foreign Relations ,
Global Magnitsky Act ,
Office of Foreign Assets Control (OFAC) ,
Private Investment Funds ,
Russia ,
SDN List ,
Ukraine ,
Virtual Currency
Over the past week, the U.S., UK, and EU imposed sweeping sanctions rolled out by the US, in response to Russia’s invasion of Ukraine, outlined here. Also last week, the Department of Justice announced the launch of Task...more
3/7/2022
/ Anti-Corruption ,
Asset Seizure ,
Biden Administration ,
Cryptocurrency ,
Digital Assets ,
Economic Sanctions ,
Enforcement Priorities ,
Foreign Policy ,
Foreign Relations ,
Forfeiture ,
Joint Task Force ,
Russia ,
Ukraine ,
Vladimir Putin
A threshold question in many cryptocurrency inquiries is whether the digital assets qualify as securities under the federal securities laws. If so, then they are subject to a full suite of federal securities regulations....more
3/1/2022
/ Anti-Money Laundering ,
BSA/AML ,
CFTC ,
Cryptocurrency ,
Digital Assets ,
Financial Services Industry ,
Financial Transactions ,
Howey ,
Investment Contract ,
Non-Fungible Tokens (NFTs) ,
Regulatory Oversight ,
Securities and Exchange Commission (SEC) ,
Unregistered Securities
In response to Russia’s invasion of Ukraine, President Biden announced sanctions against Russia. Following an executive order issued on February 21, 2022, the U.S. Department of Treasury’s Office of Foreign Assets Control...more
3/1/2022
/ Biden Administration ,
Blocked Person ,
Economic Sanctions ,
Export Controls ,
Financial Transactions ,
Foreign Policy ,
Foreign Relations ,
Foreign Trade Regulations ,
General Licenses ,
Military Conflict ,
Office of Foreign Assets Control (OFAC) ,
Russia ,
SDN List ,
SWIFT ,
Ukraine ,
Vladimir Putin
If 2021 was the year in which regulators and investors enthusiastically embraced environmental, social and governance (“ESG”) considerations, by creating new legal and regulatory frameworks, then 2022 will be the year for...more
2/25/2022
/ Business Plans ,
Business Strategies ,
Capital Investments ,
Climate Change ,
Corporate Governance ,
Corporate Social Responsibility ,
Cryptocurrency ,
Disclosure Requirements ,
Environmental Social & Governance (ESG) ,
Investment ,
Private Funds ,
Publicly-Traded Companies ,
Sustainability
We reported last year that unprecedented SPAC deal volume signaled an increased risk for disputes given their unique structure, including risks associated with disclosure requirements, material non-public information,...more
The SEC’s push to regulate the next generation of blockchain-based applications will likely give rise to disputes and enforcement actions, particularly in the developing decentralized finance (DeFi) space....more
Last year, we wrote, “The regulatory and litigation risks for private funds are greater than at any time since the financial crisis in 2008.” That statement is even more true today....more
2/2/2022
/ Decentralized Finance (DeFi) ,
Digital Assets ,
Environmental Social & Governance (ESG) ,
Insider Trading ,
Investment Funds ,
Investment Management ,
Investment Portfolios ,
Private Equity ,
Private Funds ,
Risk Management ,
Special Purpose Acquisition Companies (SPACs)
Privacy and cybersecurity issues continue to garner significant attention in the U.S. and abroad. Private investment funds registered with the SEC and their portfolio companies will likely see increased regulatory scrutiny...more
8/30/2021
/ Cybersecurity ,
International Data Transfers ,
Popular ,
Portfolio Companies ,
Privacy Concerns ,
Private Investment Funds ,
Ransomware ,
Regulatory Oversight ,
Regulatory Standards ,
SEC Examination Priorities ,
Securities and Exchange Commission (SEC)
As the financial services industry prepares for expanded criminal and civil enforcement under the Bank Secrecy Act (“BSA”) with the passage of the Anti-Money Laundering Act of 2020, FinCEN’s recent case against Capital One...more
Ransomware is a Serious and Growing Problem -
In recent years, Ransomware has evolved from merely encrypting files/disabling networks in solicitation of ransom, to sophisticated attacks that often involve actual data...more
12/15/2020
/ Cyber Attacks ,
Cyber Crimes ,
Cybersecurity ,
Data Breach ,
Data Protection ,
Disclosure Requirements ,
Hackers ,
Office of Foreign Assets Control (OFAC) ,
Popular ,
Ransomware ,
Securities Act of 1933 ,
Securities and Exchange Commission (SEC) ,
Securities Exchange Act ,
Strict Liability
On August 18, 2020, the Financial Crimes Enforcement Network (FinCEN), which is the primary regulator and administrator of the Bank Secrecy Act (BSA), issued a statement on enforcement of the BSA. The requirements of the BSA...more
9/17/2020
/ Anti-Money Laundering ,
Bank Secrecy Act ,
Compliance ,
Corruption ,
Department of Justice (DOJ) ,
Enforcement Actions ,
Enforcement Guidance ,
Financial Crimes ,
Financial Institutions ,
FinCEN ,
National Security ,
Warning Letters
On July 13, 2020, Proskauer filed an amicus brief on behalf of 15 educational institutions in support of a preliminary injunction sought by Harvard University and MIT in the District of Massachusetts against enforcement of a...more
7/14/2020
/ Amicus Briefs ,
Coronavirus/COVID-19 ,
Customs ,
Educational Institutions ,
F-1 Visa ,
Foreign Students ,
Harvard University ,
Immigration and Customs Enforcement (ICE) ,
Immigration Enforcement ,
Massachusetts Institutie of Technology (MIT) ,
Pro Bono
The SEC has been active in the private equity space recently after being relatively quiet for some time. A recent enforcement action serves as a reminder for fund sponsors that regulators are continuing to look at fund...more
Last year, we highlighted the risks of filing a Section 220 books and records request post-litigation, citing a case where the Delaware Chancery Court found that such use was an improper attempt to “sue first, ask questions...more
The private fund industry is more in the public eye than ever before. Private capital and private markets have experienced massive growth over the last two decades, substantially outpacing the growth of public equity. We have...more
2/19/2020
/ Anti-Money Laundering ,
Capital Markets ,
CFTC ,
Cryptocurrency ,
Global Economy ,
Initial Public Offering (IPO) ,
Investment Banks ,
OCIE ,
Private Equity ,
Private Funds ,
SEC Examination Priorities ,
Securities and Exchange Commission (SEC) ,
Venture Capital
Under rule 206(4)-2 of the Advisers Act, otherwise known as the Custody Rule, it is a fraudulent practice for a registered investment adviser to have custody of client funds or securities, unless the adviser takes certain...more
12/12/2019
/ Auditor Independence ,
Compliance ,
Custody Rule ,
Enforcement Actions ,
Financial Statements ,
Form ADV ,
GAAP ,
Investment Adviser ,
Investment Advisers Act of 1940 ,
PCAOB ,
Regulation S-X ,
Securities and Exchange Commission (SEC) ,
Willful Violations
Every year, a staggering number of bright minds do not attend college as a result of their family’s financial circumstances. Minds Matter confronts this issue head on by offering a comprehensive and highly successful...more
As a further indication of the SEC’s focus on the asset management industry, on November 1, 2019 the Commission formally established an Asset Management Advisory Committee. This follows the SEC’s recent announcement of its...more
The Third Circuit recently issued an important decision for private fund advisors who serve on corporate boards. In a precedential decision on a matter of first impression, the Third Circuit distinguished the role of...more
The SEC, in conjunction with the Colorado Bar Association and Colorado Society of Certified Public Accountants, recently sponsored the 51st Annual Rocky Mountain Securities Conference featuring SEC officials and corporate...more
6/11/2019
/ Administrative Law Judge (ALJ) ,
Administrative Proceedings ,
Advisors Act ,
Appointments Clause ,
Corporate Fines ,
Enforcement Actions ,
Internal Investigations ,
Kokesh v SEC ,
Lucia v SEC ,
Professional Conferences ,
Restitution ,
SCOTUS ,
Securities and Exchange Commission (SEC) ,
Share Classes ,
Statute of Limitations