In a recent move by the U.S. Securities and Exchange Commission (SEC), media and entertainment firm, Impact Theory, LLC, came under fire for breaching the Securities Act of 1933. The company stand accused of creating an unauthorized offering of securities specific to non-fungible tokens (NFTs). The details of the case came to light on August…
On September 6, 2023, the U.S. Securities and Exchange Commission’s (SEC) Division of Examinations published a document that may offer invaluable insight for lawyers and legal professionals in the manoeuvring of compliance systems and examination preparations. The Risk Alert, entitled “Investment Advisers: Assessing Risks, Scoping Examinations, and Requesting Documents” gives us a peak into the…
In an interesting development in the financial world, Grayscale Investments, LLC reported a provisional win in their bid for a spot Bitcoin ETP. Decided on August 29, 2023, a three-judge panel from the District of Columbia Circuit Court of Appeals has ruled in favor of Grayscale against an order from the Securities and Exchange Commission…
The U.S. Securities and Exchange Commission (SEC) has increased its regulatory enforcement action against unregistered offerings of non-fungible tokens (NFTs). Over the past two weeks, the SEC announced two actions against major NFT platforms, notably Impact Theory, LLC and Stoner Cats 2, LLC. These enforcement measures derive from unregistered offerings of cryptocurrency asset securities by…
In what has been viewed as a welcome development, the UK government, signaled its intention to repeal the 1.5% charge to UK stamp taxes on issuances of securities and certain ‘exempt capital-raising transfer’ to a depositary receipt issuer or a clearance service. The change which will be enacted in the Finance Bill is expected to…
In an unexpected shift in the business landscape, transaction volumes under the Hart Scott Rodino Act (HSR Act) have been witnessing a considerable decline so far in FY 2023. The HSR Act, a fundamental piece of federal legislation, mandates companies aiming to merge or acquire particular assets or voting securities to notify both the Federal…
In a recent and significant turn of events, the Securities and Exchange Commission (SEC) and its staff have undertaken a slew of actions that mandate reevaluation of risk tolerance from registered investment advisers (RIAs) for relatively routine business practices. These include marketing, custody and other procedures traditionally associated with the role of RIAs. August 21st…
In a significant development in a legal battle involving the U.S. Securities and Exchange Commission (SEC), Covington & Burling LLP has confirmed it doesn’t plan to contest a court directive instructing it to disclose the identities of several clients embroiled in a 2020 cyberattack. The declaration emerged during a Monday court session, contributing to the…
On August 23, 2023, the Securities and Exchange Commission (the “SEC”) announced the adoption of new rules and rule amendments under the Investment Advisers Act of 1940. These changes, which will significantly impact how advisers to private funds operate, apply not just to registered advisers, but also to exempt reporting advisers and those not registered…
In a landmark move on August 23, 2023, the U.S. Securities and Exchange Commission (SEC) has introduced a wide range of changes, amending rules under the Investment Advisers Act of 1940 (Advisers Act). These amendments principally affect the advisers to private funds, through the creation of various new obligations. These changes were traced in detail…
In a significant move, U.S. Senator Sherrod Brown (D-OH), Chair of the Senate Committee on Banking, Housing, and Urban Affairs, has made a formal appeal to key figures in national finance referencing the cryptocurrency markets. On September 14, 2023, he urged Treasury Secretary Janet Yellen, Securities and Exchange Commission Chair Gary Gensler, and Commodity Futures…
The U.S. Securities and Exchange Commission (SEC) is reportedly about to finalize a new rule aimed at preventing false advertising by environmentally sustainable, socially responsible and good governance- (ESG) focused investment funds. Such a move would be significant within the American business landscape, which has seen a notable uptick in the establishment and participation in…
In a significant legal development, California could become the first US state to hold companies accountable for their contributions to climate change. The state legislature has passed two bills intended to mandate reporting on climate emissions and associated risks. Currently, all eyes are on proposed federal and European climate disclosure rules, making this move by…
On August 23, 2023, the US Securities and Exchange Commission (SEC) voted to adopt a final set of rules and amendments under the Investment Advisers Act of 1940, resulting in substantial expansion of regulatory compliance requirements for private fund advisers. This decision is significantly affecting various categories of advisers, including both registered and non-registered private…
In a recent move by HM Revenue & Customs (“HMRC”), it has been confirmed that the 1.5% charge on the issuance of UK shares into depositary receipt systems and clearance services will cease to apply starting from 1 January 2024. The change also impacts certain related transfers. This development has been marked by the publishing…
In a significant development, the United States Court of Appeals for the Second Circuit reinforced the Kirschner v. JP Morgan Chase Bank, N.A. ruling from 2020, stating that a $1.775 billion syndicated term loan granted to Millennium Laboratories LLC (Millennium) does not qualify as a security. This recent affirmation adopts a fact-specific analysis to arrive…
In a span of just over two weeks, the U.S. Securities and Exchange Commission (SEC) announced its second enforcement action related to non-fungible tokens (NFTs). This action was brought against Stoner Cats 2 (SC2), the creator of a popular, celebrity-endorsed animated web series, as reported here. The charges were specifically related to SC2 conducting an…
On September 11, 2023, the SEC (Securities and Exchange Commission) disclosed the settlement of Administrative Proceedings against nine investment advisers. The proceedings refer to their practices of advertising hypothetical performance data without the necessary adoption or implementation of policies and procedures as prescribed by the Marketing Rule. Moreover, a couple of them did not keep…
Earlier today, another significant stride in the regulatory sphere of the U.S. legal landscape came into focus. The Securities and Exchange Commission’s (SEC) Private Fund Adviser Rules have been officially published in the Federal Register. True to the form of all federal regulations, this publication kickstarts the countdown to the Rules’ compliance dates. Of particular…
As we see the summer months of 2023 draw to a close, one cannot help but notice the significant events making headlines in relation to privacy laws, particularly in the United States. The events in question are to varied scales and magnitudes— ranging from statewide legislation in Oregon to federal agency action by the Securities…
The Securities and Exchange Commission (“SEC”) has adopted new rules to refine the regulation of private fund advisers as a part of the Investment Advisers Act of 1940 (“Advisers Act”), according to a recent report in JD Supra. These changes primarily focus on enhancing the quality of investor protection and bolstering transparency levels in the…
In a recent legislative response tied to the Brexit fallout, UK authorities have proposed eliminating the 1.5% stamp tax charge on issues, and certain transfers, of securities to depositary receipt systems and clearance services (or their nominees). Up until now, this tax obligation has been set to come back into force on the 1st of…
Recent legislative amendments have brought significant, yet delayed changes to the United Kingdom’s financial regulatory framework. Originally set to be revoked, an unexpected turn of events has resulted in the delay of the revocation of the Collective Investment in Transferable Securities (Contractual Scheme) Regulations 2013. This news impacts companies and law firms handling collective investment…
The Securities and Exchange Commission (SEC) recently adopted new private fund adviser rules and amendments to the Investment Advisers Act of 1940 (the “Advisers Act”). Notably, these changes introduce new obligations for private fund advisers including exempt reporting advisers. Mainly, these new obligations can be divided into two primary categories: reporting requirements and prohibited activities….
August 2023 has been bustling with significant changes and developments within the Securities and Exchange Commission (SEC). From important enforcement developments to the settlement of legal actions, the month that just ended has witnessed critical shifts that will impact corporate legal departments and law firms alike. Here’s a summary of the Top 5 SEC developments…