Category Archives: Securities Compliance & Arbitration

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Senators Warren and Cotton Misled by Misleading Report on Broker Check

Posted in Business & Corporate, Securities Compliance & Arbitration

Two US Senators recently demanded that FINRA explain how it plans to minimize the high rate of brokers who are involved in criminal activity or have been the subject of customer complaints. Clearly Senators Warren and Cotton are not familiar with how the FINRA U-4 and U-5 process works. In addition, they are probably not… Continue Reading

Washington DC Issues New Exempt Reporting Adviser Rule for Venture Capital Funds

Posted in Securities Compliance & Arbitration

Investment advisers should take note, as there has been an announcement of a new rule which might affect them. More specifically, any investment advisers that: (1) act solely as advisers to one or more venture capital funds; (2) are exempt from the registration requirements under the Investment Advisers Act of 1940; and (3) comply with… Continue Reading

Martin Shkreli Arrested for Alleged Securities Fraud Scheme

Posted in Securities Compliance & Arbitration

Martin Shkreli, the controversial CEO of Turning Pharmaceuticals, and his attorney were indicted in an alleged securities fraud scheme. On December 14, 2015, a grand jury paneled in Brooklyn, New York, returned a seven-count indictment against Martin Shkreli. Mr. Shkreli is charged with seven counts of securities fraud and conspiracy. His attorney, Evan L. Greebel… Continue Reading

Payments of Transaction-Based Compensation by FINRA Members – A Changing Game for Asset Purchases, Selling Groups and Retiring Representatives

Posted in Securities Compliance & Arbitration

Introduction On December 30, 2014, the Securities and Exchange Commission (“SEC”) approved a new Financial Industry Regulatory Authority (“FINRA”) rule governing transaction-based payments to unregistered persons. The new FINRA rule—Rule 2040—became effective on August 24, 2015. If you are a FINRA-registered broker-dealer that currently pays an unregistered person, now is a perfect time to examine… Continue Reading

Shareholder Thomas D. Giachetti Published Article in Investment Advisor

Posted in Securities Compliance & Arbitration, Stark News

Shareholder Thomas D. Giachetti, Chair of the Securities Practice Group, authored the article SEC Clarifies RIAs’ Cybersecurity Obligations, which was published in the November issue of Investment Advisor. The article explains how the Securities and Exchange Commission’s (SEC) recent cybersecurity focus will affect RIAs. The SEC’s Office of Compliance Inspections & Examinations (OCIE) released a… Continue Reading

Real Estate Developers Interested in Offering Equity or Debt for New Projects under Regulation A+

Posted in Securities Compliance & Arbitration

On June 19, 2015, real estate developers have a new avenue for raising funds. They no longer have to knock on banks doors and pay interest and provide personal guarantees, sign commercial documents pledging their homes, real estate or their business equipment, comply with Regulation D and Rule 506, or use their own finances. They… Continue Reading

Regulation S-ID: SEC and CFTC Impose New Identify Theft Regulations Requiring Investment Advisory Firms to Consider Updates to Policies and Procedures

Posted in Securities Compliance & Arbitration

On April 10, 2013, the Securities and Exchange Commission (“SEC”) and Commodity Futures Trading Commission jointly adopted and announced new identity theft red flag regulations, which are being imposed pursuant to their respective authority under Dodd-Frank Act and the Fair Credit Reporting Act (“FCRA”).

CEO’s “Shout Out” to Employee Triggers SEC Scrutiny

Posted in Securities Compliance & Arbitration

In July 2012 Netflix, Inc. (“Netflix”) Chief Executive Officer, Reed Hastings, posted a seemingly innocuous statement to his personal Facebook page:

Congrats to Ted Sarandos, and his amazing content licensing team. Netflix monthly viewing exceeded 1 billion hours for the first time ever in June. When House of Cards and Arrested Development debut, we’ll blow these records away. Keep going, Ted, we need even more!