June 2, 2020

CFTC Issues Customer Advisory Regarding Commodity ETPs and Funds

Recently, the CFTC issued a customer advisory (Advisory) in response to increased investor interest in exchange-traded products (ETPs) and funds that invest in futures or other types of commodity interests (collectively, Pools). The Advisory highlights the distinctions between ETPs and funds that invest in securities and Pools, which include the…

Continue reading...

June 2, 2020

SEC Staff Withdraws Prior No-Action Guidance on State Control Share Acquisition Statutes

On May 27, 2020, the SEC staff (Staff) issued a statement (Statement) withdrawing a prior no-action letter (Boulder Total Return Fund, SEC No-Action Letter (Nov. 15, 2010) (Boulder)) addressing certain aspects of the intersection of the voting requirements of Section 18(i) of the 1940 Act and state control share acquisition…

Continue reading...

May 22, 2020

FINRA Issues Notice Reminding Firms of Sales Practice Obligations for Certain Exchange-Traded Products

On May 15, 2020, FINRA issued Regulatory Notice 20-14 (Notice) in response to recent “extraordinary conditions” that have caused significant volatility in complex oil-linked exchange-traded products (ETPs). The Notice reminds broker-dealers that are members of FINRA (firms) of their sales practice obligations in connection with these ETPs and, similar to…

Continue reading...

May 21, 2020

SEC Charges Three Former Audit Firm Partners for Exam Sharing Misconduct

On May 18, 2020, the SEC entered into settlement agreements with three former partners of an independent public accounting firm (Firm) in connection with the partners’ conduct involving improperly receiving and sharing information about internal continuing professional education exams conducted by the Firm. The former partners participated in soliciting or…

Continue reading...

May 15, 2020

ETF Sponsors Submit Letters to Major Exchanges Regarding ETP Categorization

On May 13, 2020, a group of six ETF sponsors submitted letters to Cboe Global Markets, Inc., NASDAQ, and Intercontinental Exchange Inc. (the parent of NYSE Arca) urging that each exchange adopt exchange listing rules or other means to categorize exchange-traded products (ETPs) differently (ETP Letter).  The ETP Letter proposes…

Continue reading...

May 4, 2020

Major Exchanges for ETFs Receive Approval for Generic Listing Standards for ETFs that Can Rely on Rule 6c-11

Cboe BZX Exchange, Inc. (Cboe), The Nasdaq Stock Market LLC (NASDAQ) and NYSE Arca, Inc. (NYSE) received approval from the SEC’s Division of Trading and Markets (Division) to adopt rules that establish generic listing standards to permit the listing and trading of ETFs that can rely on Rule 6c-11 under…

Continue reading...

May 4, 2020

SEC Fines Fund Adviser for Overvaluing its Securities and Misleading Performance Disclosures

On April 28, 2020, the SEC fined a fund’s adviser in a consent order (Order) for the adviser’s conduct involving the fund’s overvaluation of its securities and the adviser’s misleading statements about the fund’s performance in shareholder communications. The fund primarily invested in non-agency mortgage-backed securities (NA MBS) and, during…

Continue reading...

April 24, 2020

SEC Adopts Rule Clarifying Fair Value Determinations

On April 21, 2020, the SEC proposed Rule 2a-5 under the 1940 Act (Rule) that specifies what is required for a fund (or a business development company) to determine the fair value in good faith of the fund’s investments that do not have readily available market quotations for purposes of Section 2(a)(41) of the 1940 Act and Rule 2a-4 under the 1940 Act.

Continue reading...

April 16, 2020

SEC’s Division of Investment Management Issues Statement on Importance of Delivering Timely and Material Information to Investment Company Investors

On April 14, 2020, the SEC’s Division of Investment Management (Division) issued a statement to underscore the importance of delivering required information to investment company investors on a timely basis (Statement).  The Statement emphasizes that investment companies are subject to Section 10(a)(3) of the 1933 Act, which requires any prospectus used…

Continue reading...

April 16, 2020

SEC’s Division of Investment Management Issues Information Update on Exemptive Application Hearing Requests

The SEC’s Division of Investment Management (Division) recently issued an Information Update (Update) regarding changes to the SEC’s procedures for granting exemptive applications filed under the 1940 Act or the Advisers Act.  Before issuing an exemptive order, the SEC provides a public notice summarizing the exemptive relief that will be…

Continue reading...

Menu