May 27, 2010

SEC Brings Enforcement Action Against Kenneth Starr

The SEC charged Kenneth Ira Starr, a New York-based financial adviser, with fraud, alleging that he stole client money for his personal use.  The SEC further alleged that Starr and two entities he controlled - Starr Investment Advisors LLC and Starr & Company LLC - have made unauthorized transfers of money in client accounts that ultimately wound up in Starr's personal accounts.

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May 26, 2010

IM Director Donohue Speaks on Money Market Funds and the IFRS

SEC Division of Investment Management Director Buddy Donohue gave the keynote address reviewing some of the recent steps that the SEC has taken with respect to regulating money market funds.

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May 26, 2010

SEC Proposes Consolidated Audit Trail System To Better Track Market Trades

The SEC proposed a new rule that will require the self-regulatory organizations (SROs) to establish a consolidated audit trail system designed to allow the SEC and other regulators to track information related to trading orders received and executed across the securities markets.

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May 26, 2010

SEC Approves New Municipal Securities Disclosure Rules

The SEC’s newly revised Rule 15c2-12 is designed to improve the quality and timeliness of municipal securities disclosure.  The SEC's statutory authority over municipal securities is limited because these securities are exempt from the disclosure requirements of the federal securities laws.

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May 26, 2010

SEC Charges Investment Adviser with Fraud

The SEC charged a purported money manager, his New York City-based investment adviser, and two of his associates with conducting an affinity fraud and Ponzi scheme that specifically targeted investors living in the Caribbean and African-American communities of Brooklyn, New York.

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May 26, 2010

Kansas Resident Charged with Acting as an Unregistered Broker and Impersonating an Investment Advisory Client

The SEC brought an administrative action against James E. Otto, finding that he committed fraud by using PIN numbers and other information provided him by account holders to access their accounts at TD Ameritrade and effect securities transactions after TD Ameritrade had barred him from accessing any TD Ameritrade account or allowing others to access those accounts on his behalf.

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May 25, 2010

SEC Issues Q&A Addressing Recent Amendments to Rule 2a-7

The SEC’s Division of Investment Management issued a Q&A addressing various issues raised by the amendments to Rule 2a-7 under the 1940 Act that were adopted on February 23, 2010.  The Q&A addresses the following five topics:

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May 20, 2010

SEC’s Division of Investment Management Modifies Custody Q&A Release

After the recent adoption of amendments to Rule 206(4)-2 under the Advisers Act, the "custody rule," the SEC staff prepared responses to questions about the new amendments.  The SEC expects to update the Q&A from time to time in order to respond to additional questions raised by the industry.

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May 20, 2010

U.S. Senate Approves Financial Services Reform Bill

The U.S. Senate approved a broad financial regulatory reform bill, entitled the “Restoring American Financial Stability Act of 2010” or “RAFSA.”  The bill impacts most types of financial institutions, including investment advisers, mutual funds and ETFs. Here are some ways investment advisers will be impacted by the bill, if enacted:

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May 17, 2010

New York Fed Releases White Paper on Repo Reform

The Federal Reserve Bank of New York announced the publication of a White Paper on the work of the Tri-Party Repurchase Agreement (Repo) Infrastructure Reform Task Force.

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