On June 25, 2020, five federal regulatory agencies finalized a rule modifying the Volcker rule’s prohibition on banking entities investing in or sponsoring hedge funds or private equity funds. The Volcker rule generally prohibits banking entities from engaging in proprietary trading and from acquiring or retaining ownership interests in, sponsoring, or having certain relationships with a hedge fund or private equity fund. The rule will be effective on October 1st. [https://www.sec.gov/news/press-release/2020-143]
On June 23, 2020, the SEC issued a risk alert on an overview of compliance issues observed by the Office of Compliance Inspections and Examinations (“OCIE”) in examinations of registered investment advisers that manage private equity funds or hedge funds. [https://www.sec.gov/files/Private%20Fund%20Risk%20Alert_0.pdf]
On June 30, 2020, the SEC charged an individual with falsely represented that he would profitably manage investor assets whn in fact he operated a Ponzi scheme. [https://www.sec.gov/litigation/admin/2020/ia-5529.pdf]
On June 29, 2020, the BNP Paribas Securities Corp. settled a enforcement action for loaning securities to a customer to settle purported “long” sales in violation of Regulation SHO. [https://www.sec.gov/enforce/34-89177-s]
On June 16, 2020, the SEC charged an individual, who was the COO and COO of a registered investment adviser, for defrauding clients by electronically debiting invoice client accounts more than what they owed to the firm and redirected the excess to his personal bank account; and instructing the firm’s payroll vendor to pay him a higher salary that the salary and bonus authorized by the firm, with the excess funds routed electronically to his personal bank account. [https://www.sec.gov/litigation/admin/2020/ia-5522.pdf]
On June 5, 2020, the SEC charged an individual with engaging in conduct that operated as a fraud and deceit on other investors and manipulated the volume and price of trading in stock. [https://www.sec.gov/litigation/admin/2020/ia-5519.pdf]
On June 1, 2020, U.S. Bancorp agreed to settle charges arising from breaches of fiduciary duties in connection with its mutual fund share class selection practices and its receipt of 12b-1 fees.