March 31, 2010

SEC Appoints Agency’s First “Chief Compliance Officer”

The SEC appointed Kathleen M. Griffin as its first Chief Compliance Officer.  The purpose of the new position is to strengthen the SEC's internal compliance program.  The position was created to streamline and centralize oversight responsibility for employee securities transactions and financial disclosure reporting.  Ms. Griffin will head a new compliance unit within the SEC's Office of Ethics Counsel.

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March 29, 2010

Supreme Court Issues Jones v. Harris Opinion

The United States Supreme Court upheld the Gartenberg standard as the appropriate approach for courts and boards of directors to review mutual fund investment advisory contracts and fees. Click http://xlo3.wpengine.com/files/Publication/76c9f34c-f815-44c0-ae01-63039980b95e/Presentation/PublicationAttachment/506b2911-4f57-4772-8452-741bec682729/Supreme%20Court%20Upholds%20Gartenberg%20Standards.pdf to access a Seward & Kissel Alert on this decision.

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March 29, 2010

SEC Brings Charges Against Unregistered Investment Adviser

The SEC brought fraud charges against Enrique F. Villalba, Jr., of Cuyahoga Falls, Ohio, for allegedly misrepresenting the safety and nature of his investment strategy, and for misappropriating millions of dollars of client funds.  Villalba is an unregistered investment adviser.

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March 26, 2010

Two Investment Adviser Employees Settle Fraud Charges

The SEC settled fraud charges that it had brought against Brian Travis and Nicholas Vulpis, two investment adviser employees for JLF Asset Management LLC (JLF).

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March 26, 2010

Commissioner Aguilar Speaks on Fiduciary Standard

SEC Commissioner Luis Aguilar spoke at the IA Compliance Best Practices Summit 2010 in Washington, D.C. on the fiduciary standard.

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March 25, 2010

Investment Bank Employee Charged with Insider Trading

The SEC uncovered a complex trading scheme that profited from insider M&A negotiations.

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March 25, 2010

SEC Staff Evaluating the Use of Derivatives by Mutual Funds

The SEC is conducting a review to evaluate the use of derivatives by mutual funds, exchange-traded funds (ETFs) and other investment companies. The review will examine whether and what additional protections are necessary for those funds under the 1940 Act.

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March 24, 2010

Pay-to-Play Action Brought Against Municipal Securities Dealer (IA) citing Violations of MSRB Rule G-37 and Section 15B(c)(1) of the Exchange Act

The SEC brought charges against John Kendrick, a registered representative associated with Southwest Securities, Inc. (Southwest), a registered broker-dealer and municipal securities dealer.

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March 17, 2010

Due Diligence Case Brought Against Investment Adviser

The SEC brought an administrative action against a registered investment adviser, and its managing director for failing to disclose to clients that their promised due diligence had encountered significant problems.

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March 16, 2010

Adviser Violates Short Selling Rules

The SEC brought an administrative action against a registered investment adviser and affiliate entities for covering part of their short positions with offering shares through sham transactions.

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