Client Alerts & Publications Archive

In a recent opinion of the Supreme Court of the State of Utah (Carter v. Lehi, 2012 UT 2 (2012)), the court abandoned the prior framework it used for determining whether a matter is a proper use of the peopleʼs initiative power and set forth a new framework. 

On February 8, 2012, the IRS released proposed regulations under Code §§ 1471-74 (generally referred to as the FATCA provisions). The proposed regulations clarify, expand, and relax the requirements of the earlier FATCA Notices. This Client Alert briefly summarizes the most significant changes. 

The beginning of each year provides an opportunity for investment advisers to review annual compliance and regulatory matters, including issues related to private investment funds and commodity pools. This Alert briefly summarizes some of the primary issues that advisers might consider in their 2012 annual review and update processes. Many of these issues apply to unregistered advisers as well as registered advisers. 

The Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”) requires the Securities and Exchange Commission (“SEC”) to conduct a study of legal and regulatory requirements applicable to broker-dealers, investment advisers, and associated persons who provide personalized investment advice and recommendations about securities to retail customers.  

The Municipal Securities Rulemaking Board recently filed a proposed rule change with the Securities and Exchange Commission which would:

• amend MSRB Rule G-14 and its Real-time Transaction Reporting System Procedures to add inter- dealer yield data to the MSRBʼs Electronic Municipal Market Access website; and

• amend the RTRS information system and subscription service to remove certain outdated information and infrequently used reporting, add an RTRS-calculated yield, and require dealers to submit dollar prices for certain trades. 

The Financial Industry Regulatory Authority, Inc. recently issued guidance to members concerning the supervision of complex products — securities or investment strategies with novel, complicated, or intricate derivative-like features such as structured notes, inverse or leveraged exchange-traded funds, hedge funds, and securitized products. FINRA believes that such features may make it difficult for retail investors to understand the essential characteristics of complex products and their risks. As discussed below, FINRA also identified characteristics that may render a product “complex” for purposes of determining whether such product should be subject to heightened supervisory and compliance procedures. 

The Securities and Exchange Commission recently approved a rule change proposed by the Financial Industry Regulatory Authority, Inc. relating to the “best execution” obligation of broker-dealers. 

The Office of Compliance Inspections and Examinations of the Securities and Exchange Commission (“SEC”) recently issued a National Examination Risk Alert (the “Risk Alert”) on the use of social media by investment advisers. The Risk Alert provides guidance on the application of the Investment Advisers Act of 1940 (the “Advisers Act”) and its rules to the use of social media technologies. 

Over the course of the last few years, the Financial Industry Regulatory Authority, Inc. has proposed changes to the rules governing broker-dealer communications with the public. After receiving significant comments on earlier proposals, FINRA recently filed Amendment No. 2 to the proposed rule changes and a rebuttal letter regarding the comments received.  

The annual continuing disclosure deadline to file financial information and operating data with EMMA is rapidly approaching. Each School District should check its own bond documentation, but for most Districts the annual filing deadline is 210 days after the close of the Districtʼs fiscal year. For this reporting period the deadline is on or about January 26, 2012. If you are unsure of your filing deadline or requirements, please check with us or with your underwriter or financial advisor. We have recently seen increased scrutiny by the Securities and Exchange Commission (the “Commission”) with respect to such filings, and it is important that you comply with the requirements of each of your Continuing Disclosure Undertakings. 

On July 21, 2010, President Obama signed into law The Dodd-Frank Wall Street Reform and Consumer Protection Act. The Dodd-Frank Act makes significant changes to the existing financial services legal framework, affecting nearly every aspect of the industry. This summary highlights many of the provisions of the Dodd-Frank Act that matter most to the asset management industry—investments advisers, broker- dealers, registered investment companies, hedge funds, private equity funds and other alternative investment funds. 

The transition to 2012 has brought two important developments in federal Clean Air Act rules that may affect power plants across the US. In late December, the US Environmental Protection Agency finalized the new power plant emissions standards for mercury, acid gases, and non-mercury metallic toxic pollutants (including arsenic, chromium, nickel, and others) for new and existing coal- and oil-fired utility steam generating units. Dubbed the “Utility MACT,” these new standards apply in all 50 states and will affect many of the nationʼs 1,400 oil- and coal-fired electric steam generating units at approximately 600 power plants throughout the country. This marks the first time that EPA has set national emissions limits on mercury from power plants 

The Financial Industry Regulatory Authority, Inc. issued Regulatory Notice 10-57 to alert member firms that it expects broker-dealers to develop and maintain robust funding and liquidity risk management practices.