As 2018 came to a close, U.S. financial regulators continued to pursue anti-money laundering (“AML”) enforcement actions against financial institutions, announcing monetary penalties against and resolutions with three U.S. broker-dealers. The Financial Crimes Enforcement Network (“FinCEN”), the Securities and Exchange Commission (“SEC”) and the
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Broker-Dealer
SEC Adopts Enhanced Order Handling Disclosure Requirements
The SEC recently voted to adopt amendments to Rule 606 of Regulation NMS (the “Final Rule”) that expand broker-dealers’ disclosure obligations with regard to how they handle investors’ orders. Specifically, the Final Rule requires broker-dealers, beginning May 20, 2019, (i) to provide, upon request, individualized reports in a…
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The CAT Nap Continues
Posted in Broker-Dealer, SEC
The Director of the SEC’s Division of Trading and Markets, Brett Redfearn, recently provided an update on the status of the consolidated audit trail (the “CAT”), which is being developed by the SROs and Thesys Technologies, LLC, the CAT plan processor. The public statement noted that although the…
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SEC Proposes Equity Market Study: Beginning of the End for the Maker-Taker Model?
In the first major trading and markets initiative under SEC Chairman Jay Clayton, on March 14, 2018, the SEC proposed to establish a transaction fee pilot program to study the effects of maker-taker fee structures. A pilot study was initially recommended by the SEC’s Equity Market Structure Advisory Committee in…
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FINRA Seeks Comment on Applying Various Rules to U.S. Treasuries and Extending Certain Equity Market Rules to All Debt Securities
Posted in Broker-Dealer, SEC
Responding to a 2016 request by the SEC (in consultation with the Treasury Department), FINRA recently reviewed the extent to which various FINRA rules apply to U.S. Treasury securities. Following up on that analysis, on February 6, 2018, FINRA issued Regulatory Notice 18-05, requesting comment on whether it should…
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The CFTC Forges Ahead with Listed Bitcoin Derivatives
By Jai R. Massari on
With virtual currency markets booming and bitcoin prices at record highs, U.S. financial regulators have been—each in its own manner—considering whether and how to regulate virtual currencies and related products. Last week, the U.S. Commodity Futures Trading Commission (CFTC) announced that three futures exchanges—CME, Cboe Futures Exchange, and Cantor Exchange—self-certified…
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Treasury Chimes in on Equity Market Structure
The Treasury Department’s recent report on capital markets regulation includes a robust discussion of equity market structure issues. The report does not break new ground or raise issues that have not been debated previously at length, including by the SEC’s Equity Market Structure Advisory Committee (“EMSAC”). That said, the report
Security Concerns Prompt Questions Regarding Whether the SEC Should Delay the CAT
Posted in Broker-Dealer, SEC
In the wake of a highly-publicized cybersecurity breach involving the SEC’s EDGAR system, SEC Chairman Jay Clayton has been in the hot seat at recent congressional hearings, fielding pointed questions as to whether the SEC should delay implementation of the Consolidated Audit Trail (“CAT”). The SEC has not announced a…
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Congress Passes the FAIR Act, with New Tool to Nudge the SEC
On September 27, 2017, Congress passed the Fair Access to Investment Research Act of 2017 (the “FAIR Act”), sending the bill to President Trump for his signature. The FAIR Act instructs the SEC to amend its rules to ease various restrictions and burdens that broker-dealers face when issuing research reports…
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Webcast: So, Now You Own a Broker-Dealer!
By Lanny A. Schwartz, Hilary Sunghee Seo & Nancy Lee on
Posted in Broker-Dealer
Regulatory Considerations for Integrating a Brokerage Firm into a Corporate Group
The recent Davis Polk and Oliver Wyman webcast discussion on the regulatory issues faced when integrating a broker-dealer, is now available On Demand for your convenience.
The webcast reviews our memoon common regulation-driven integration considerations.