News

June 15, 2023

His remarks, entitled “Bear in the Woods,” touched on investment and liquidity risks posed by certain types of investment funds as well as the SEC’s recent proposals addressing those perceived risks. When referencing the recent open-end fund proposal, Chair Gensler stated the Commission put forward “a number of alternatives” including “either within the framework of swing pricing or liquidity fees…”

June 14, 2023

The paper highlights that boards “play a crucial role in ensuring the companies they oversee are performing the due diligence necessary to assess any risks that third parties pose to the company and its operations.” Third party vendors can provide a variety of services but boards should ensure management considers what happens if there is a breach at the vendor, or even a scenario where the vendor is out of business.

June 13, 2023

The draft sets a framework for a company to register with the SEC in order to issue a digital asset, allows for Alternative Trading Systems (ATS) to register as exchanges for crypto assets that remain securities, and provide a regulatory pathway for CFTC oversight of digital assets that move outside of the investment contract status. The draft is also silent on any specific existing assets, which likely means that digital assets currently in existence would need to be certified separately.

June 12, 2023

EY plans to hold a webinar titled, “How ESG is evolving in asset management" which will feature a discussion with asset owners and institutional consultants to capture where investors align on ESG and where fault lines have deepened.

June 8, 2023

The SEC’s Division of Investment Management held an inaugural program titled, “Conference on Emerging Trends in Asset Management.” The conference broadly touched on investor protection, the rise of private funds, investment complexity and trends, outsourcing, and industry innovation.

June 7, 2023

Tomorrow, June 8 the SEC Division of Examinations staff will discuss topical issues related to investment companies and their advisers, as well as considerations for independent fund directors and CCOs. This webinar will not be recorded or archived and is only open to fund directors and CCOs.

June 6, 2023

Over the past month, multiple state attorneys general have sent subpoenas or civil investigative demands (CIDs) to certain asset managers due to their incorporation of ESG factors in investment strategy. A client alert from K&L Gates highlights the complexity of the state AG requests, noting “asset managers should think about jurisdictional questions, especially where they have no place of business or clients in a state issuing the demand.”

June 5, 2023

Tomorrow, June 6 at 2:00pm ET partners with Dechert’s financial services practice plan to review mutual fund industry litigation from 2022 and provide a preview of what to expect in regulatory enforcement in 2023.

June 1, 2023

In May, the House Financial Services Committee advanced six bills, of which four bills received bipartisan support. Of interest to directors of closed-end funds, the “Increasing Investor Opportunities Act,” (H.R. 2627) was advanced by a vote of 37-11.

May 31, 2023

Recently, the Securities and Exchange Commission released a Risk Alert highlighting observations from recent exams of investment advisers and investment companies on LIBOR transition-related risks. The Risk Alert notes that “[f]irms have made significant efforts to prepare for the transition away from LIBOR” and encourages all firms to consider the preparation and resources needed as the transition away from U.S. Dollar LIBOR approaches on June 30.

May 30, 2023

Jay Baris, a partner in Sidley Austin’s New York office has started highlighting important background and developments in the registered fund space with his podcast “Mutual Fund Minute.”

May 25, 2023

SEC Chair Gary Gensler delivered remarks entitled “Lessons from Mrs. O’Leary’s Cow” which focused on risk in the financial markets and the role the Commission plays in supporting resiliency. He noted the Commission is focused on encouraging resiliency among financial system intermediaries (such as stock exchanges, clearinghouses, broker-dealers, investment advisers, and transfer agents), Treasury market reforms, central clearing and the settlement cycle, private funds, money market and open-end funds, and cybersecurity.

May 24, 2023

According to a press release from the Attorney General’s office, the bill would “require independent public audits of cryptocurrency exchanges and prevent individuals from owning the same companies, such as brokerages and tokens, to stop conflicts of interest.” Additionally, the bill creates new regulatory responsibilities for crypto platforms, imposes prospectus and listing requirements, requires digital asset brokers to obtain and maintain custody of the digital assets, and strengthens the regulatory authority of the New York State Department of Financial Services to oversee the digital asset space.

May 23, 2023

Beginning on Thursday, May 25 and running through August, Ropes & Gray will host a series of webinars focused on the intersection of ESG policy and asset management. Program topics will touch on ESG and mutual fund directors, ESG considerations during the fundraising process for private funds, SFDR and other European considerations, the differences between the US and Europe and greenwashing.

May 22, 2023

Tomorrow, ACA plans to host a webinar entitled “Managing the Cyber and Compliance Risks of ChatGPT and Other Large Language Models.” The program will focus on the impact the advancement of Large Language Models (LLMs) such as ChatGPT and OpenAI have on entity operation.

May 18, 2023

Ernst & Young plans to host a webinar entitled, “How boards can enhance resiliency through effective risk oversight.” The webinar will cover the current risk environment and discuss how boards can promote resiliency by helping anticipate, prepare for, and respond to a changing environment as a governance priority.

May 17, 2023

Stradley Ronon’s Fintech Practice Group Chair and Derivatives & Commodities Group Co-Chair Susan Gault-Brown recently authored an article published in The Review of Securities & Commodities Regulation. In the article, Gault-Brown offers a framework to interested individuals and fund sponsors that may respond to the SEC staff’s requested feedback on whether a registered fund investing in digital assets could satisfy the 1940 Act’s custody requirements.

May 16, 2023

Tomorrow, Management Practice Inc. (MPI) will present the findings from the most recent "Survey of Mutual Fund Director/Trustee Compensation and Organizational Practices" survey. The report and program will provide aggregate compensation data received through confidential questionnaires, as well as SEC filings submitted by all fund industry complexes.

May 15, 2023

The House Financial Services Committee advanced 15 legislative measures, many on a bipartisan basis. The bills touched on the definition of an accredited investor, disclosure of financial statements by smaller companies, capital formation, and initial public offerings (IPOs), among others. Committee Chairman Patrick McHenry (R-NC) noted in his opening that many of the bills being considered are bipartisan and that “I look forward to moving those to the floor immediately.”

May 11, 2023

The authors of a recent study “Does Board Size Matter” explore whether board size impacts effectiveness and decision-making. The study found “robust evidence that forcing firms to have large boards is detrimental.” The authors explore several explanations for this including, frictions in decision-making, free-riding, coordination problems, and other possible factors.