February 15, 2019

Federal Court Dismisses Excessive Fee Case Against Blackrock

On February 8, 2019, a U.S. federal court in New Jersey dismissed a lawsuit filed in 2014 alleging that BlackRock breached its fiduciary duty by receiving excessive investment advisory fees from two mutual funds, in violation of Section 36(b) of the Investment Company Act of 1940. The suit by shareholders…

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February 15, 2019

SEC’s Office of Compliance Inspections and Examinations Issues Risk Alert Highlighting Risks and Issues Associated With Transfer Agents Also Serving as Paying Agents

On February 13, 2019, the staff of the SEC’s Office of Compliance Inspections and Examinations issued a Risk Alert that (1) highlights risks and issues associated with paying agent1 activities, (2) identifies significant exam deficiencies related to the safeguarding of funds and securities by paying agents and (3) provides a listing of some common features of robust safeguarding policies, procedures and controls for paying agents

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December 17, 2018

SEC Adopts FAIR Act Rules Promoting Research Reports on Investment Funds

On November 30, 2018, the Securities and Exchange Commission (SEC) adopted a new rule under the Securities Act of 1933 (Securities Act), Rule 139b, to extend the current safe harbor under Rule 139 to a “covered investment fund research report.” The SEC adopted Rule 139b to promote research on qualifying investment funds in furtherance of the mandate in the Fair Access to Investment Research Act of 2017 (FAIR Act), which required the SEC to expand the current safe harbor under Rule 139 to cover research reports on qualifying investment funds.

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November 15, 2018

SEC’s Office of Compliance Inspections and Examinations Issues Risk Alert Announcing Examination Initiatives Focused on Registered Investment Companies

On November 8, 2018, the staff of the SEC’s Office of Compliance Inspections and Examinations issued a Risk Alert indicating that it is conducting a series of examination initiatives focused on matters relevant to certain mutual funds and exchange-traded funds (ETFs).

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November 1, 2018

SEC Staff Issues Risk Alert Regarding Investment Adviser Compliance Issues Related to the Cash Solicitation Rule

On October 31, 2018, the SEC’s Office of Compliance Inspections and Examinations (OCIE) staff issued a Risk Alert regarding Rule 206(4)-3 under the Investment Advisers Act of 1940 (Cash Solicitation Rule).

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November 1, 2018

SEC Director of Investment Management Dalia Blass Delivers Keynote Address at the ICI Securities Law Developments Conference

On October 25, 2018, the SEC’s Director of the Division of Investment Management (Division), Dalia Blass, delivered a speech at the Investment Company Institute (ICI) Securities Law Developments Conference.

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November 1, 2018

SEC Director of Investment Management Dalia Blass Delivers Remarks at IDC – 2018 Fund Directors Conference

On October 16, 2018, the SEC’s Director of the Division of Investment Management (Division), Dalia Blass, delivered a speech at the Independent Directors Council (IDC) 2018 Fund Directors Conference.

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October 22, 2018

SEC Staff Grants No-Action Relief Regarding Board Oversight of Affiliated Transactions

On October 12, 2018, the SEC staff issued a no-action letter regarding board oversight of affiliated transactions. The staff agreed not to recommend enforcement action to the SEC for violations of Sections 10(f), 17(a) or 17(e) of the Investment Company Act of 1940 if a fund’s board of directors…

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October 22, 2018

SEC Charges Firm With Deficient Cybersecurity Procedures

On September 26, 2018, the SEC announced that it settled charges against a broker-dealer/investment adviser related to its failures to adopt and implement adequate cybersecurity policies and procedures. The failures were identified in connection with a cyber intrusion that compromised personal information of thousands of customers. The firm agreed to be censured and pay a $1 million penalty.

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September 18, 2018

Chairman Clayton Clarifies Role of SEC Staff Views

On September 13, 2018, Chairman Jay Clayton issued a statement indicating that all staff statements are nonbinding and do not create enforceable legal rights or obligations. The statement highlighted the distinction between the SEC’s rules and regulations, on the one hand, and staff views on the other.

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