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NEWSLETTER: Hot off the press this month, the SEC announced the proposed Safeguarding Rule under the Advisers Act which will modernise and strengthen custody requirements for client funds and securities. The proposals will also scope in certain assets currently outside of custodial protections under the existing custody rule. Watch this space for more details.
Also this month we saw the SEC announce charges for Form 13F violations by the Investment Adviser to the Mormon Church in the US, and against the Church for causing these violations. This puts the spotlight on the importance of filing Form 13F if you meet the volume threshold to file, even if you are not a Registered Investment Adviser. It also acts as a cautionary tale. Should investment managers consider trying to obscure activity and assets held by splitting assets across different vehicles, the SEC is watching and will look through structures created to mislead.
We note yet another recent example of SEC action against high profile promoters of crypto assets. This time the charge is against an NBA Hall of Famer Boston Celtics star, for unlawfully touting EMAX tokens on social media, without disclosing the remuneration he received for advertising and for making misleading statements by screenshotting a fake account to personally endorse holding the crypto asset security. Another reminder for celebrities to be warned that they are not above the law and that the SEC’s docket has not changed: they are still actively pursuing high-profile actions to get everyone’s attention.
Our articles set out below this month include a practical insight into the SEC’s examination priorities, essential reading to make sure you are prepared.
Rebecca Thorpe
Chief Executive Officer
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