1. On May 28, 2025, the SEC charged Kronus Financial Corporation and Finser International Corporation, along with their principal, Andrew Jacobus, for misappropriating over $17 million from 40 advisory clients, most of whom are Venezuelan nationals and include Catholic dioceses and elderly individuals. Jacobus raised approximately $39.7 million from advisory clients who believed they were investing in securities, including the Corfiser SIMI Fund and IPO stocks. Jacobus, through Kronus and Finser, offered and sold limited partnership interests in the Corfiser SIMI Fund and misrepresented to clients that their money would be invested in that fund, which purportedly invested in IPOs. Jacobus misled clients about, among other things, the legitimacy of and returns on their investments, access to their money, and the nature and balance of their investments, including by sending periodic account statements that contained fictitious holdings and balances. This matter is being litigated. https://www.sec.gov/enforcement-litigation/litigation-releases/lr-26317
2. On May 27, 2025, the SEC’s Division of Investment Management announced it will host the third annual Conference on Emerging Trends in Asset Management on Thursday, June 5, 2025. The conference will bring together a variety of asset management industry participants, regulators, and academics to discuss emerging trends in asset management. The full agenda, with a list of speakers, is available at the conference’s webpage. https://www.sec.gov/newsroom/meetings-events/2025-conference-emerging-trends-asset-management
3. On May 27, 2025, the Managed Funds Association (“MFA”) wrote a letter urging the SEC to delay the compliance date for the amended Form PF until June 2026. The letter cited Executive Orders issued by President Donald Trump directing regulators to review recent rulemakings for lawfulness and cost. The MFA stated the amended Form PF exceeds the agencies’ statutory authority and imposes unjustified burdens that do not meaningfully advance systemic risk monitoring. https://www.mfaalts.org/press-releases/mfa-urges-sec-and-cftc-to-delay-form-pf-compliance-deadline-by-one-year/#:~:text=May%2027%2C%202025-,MFA%20urges%20SEC%20and%20CFTC%20to%20delay,compliance%20deadline%20by%20one%20year&text=Washington%2C%20D.C.%20%E2%80%94%20MFA%20urged%20the,a%20letter%20submitted%20last%20Friday.
4. On May 22, 2025, SEC Commissioner Caroline Crenshaw issued an “astonishing” public statement regarding the SEC dropping several suits targeting businesses for failing to register as securities “dealers” with the agency as required by law. Crenshaw stated: “First came the abandonment of crypto lawsuits. Now the dismissals of “dealer” lawsuits. What do these unprecedented dismissals of ongoing enforcement actions have in common? They ignore the laws enacted by Congress – namely fundamental registration requirements of the federal securities laws – as well as long lines of judicial precedent. And they harm investors, businesses, and the capital markets. It is astonishing that an agency tasked with enforcing the law has decided the law does not matter. https://www.sec.gov/newsroom/speeches-statements/crenshaw-statement-dealer-lawsuits-052225
5. On May 21, 2025, Commissioner Hester Peirce spoke at the Private Funds CFO’s compliance conference. At the conference Peirce had some notable remarks on the staffing of examiners, including: “I don’t want to joke about the fact that this is a difficult time for a lot of SEC employees. There has been a lot of change and a lot of uncertainty. A lot of years of experience walked out the door, and there’s no denying that.” Peirce stated, “we all know that even before we lost folks, exams was always stretched. There are a growing number of advisers, and our exams force hadn’t kept pace with that, so I really think we have to think about how we can better use technology to enable us to have more coverage and deeper coverage. And AI I think has real potential there to help us do a better job of examining. There’s a lot of work and there’s never a shortage of enforcement work, so we’ll be busy.”
6. On May 21, 2025, Keith Cassidy, Acting Division of Examinations Director, spoke at the Private Funds CFO’s compliance conference. At the conference Cassidy had some notable remarks regarding the upcoming amendments to Regulation S-P that go into effect in June 2026. Cassidy stated that he is expecting examiners to ask about preparations for complying with the revised privacy rule. He further stated the SEC will host a series of three tailored outreach events to help promote readiness and assist firms in their preparedness to implement these new amendments to Regulation S-P. These “will cover basics about what to expect when interacting with an exam team during an examination where Regulation S-P is in scope, as well as having a broader discussion about our approach.” A risk alert may be in the offing as well, he stated. Cassidy advised that investment advisers should review their incident response plans, customer notification requirements and oversight of third parties.
7. On May 20, 2025, SEC Chair Paul Atkins told Congress that the agency has lost hundreds of employees in recent months due to voluntary buyouts and early retirement incentives, and that some now-missing expertise will need to be replaced. https://www.reuters.com/sustainability/boards-policy-regulation/wall-st-regulator-defends-steep-staff-cuts-2025-05-20/
8. On May 20, 2024, the Investment Adviser Association (“IAA”) advocated again to Congress to restore the tax deduction for financial advice. The IAA wrote to support the extension of Section 199A and to ask that it be expanded to remove the “specified service trades or business” (SSTB) designation that limits the ability of certain independent financial services professionals to fully benefit from the deduction. The Tax Cuts and Jobs Act (TCJA) created §199A, a 20% deduction on “qualified business income” for owners/shareholders of pass-through businesses, such as S corporations, partnerships, and sole proprietorships. Congress intended for all small businesses to benefit from the deduction to promote economic growth across the country. However, guidance from the Department of Treasury on §199A-5 limits owners and shareholders of SSTBs from taking advantage of the 20% deduction if their overall taxable income exceeds certain thresholds. Unfortunately, financial professionals, financial planners, investment advisers, and retirement planners currently fall under this definition.
9. On May 15, 2025, the SEC charged Christoper Aubin and his companies, Anchor State Capital LLC, formerly known as Anchor State Investments LLC, and Anchor State Properties LLC (collectively, Anchor State), with fraud for making false and misleading statements in connection with the sale of Anchor State securities. The complaint alleges that defendants used investor money to make payments to earlier investors and to pay Aubin’s own business and personal expenses. The SEC’s complaint alleges that Aubin deceived multiple investors – at least two of whom were Marine Corps veterans who had served with him. The complaint alleges that Aubin promised to use investor money to make short-term, high-interest loans to Anchor State borrowers as an alternative to traditional financing. According to the complaint, Anchor State’s investment contracts stated that investors would receive returns between 12% and 19% for investments lasting between one month and eight months. The complaint alleges that Aubin made very few real loans to borrowers. Rather, as the complaint further alleges, Aubin actually used investors’ funds largely to make Ponzi-like payments to earlier investors or to pay for his own business and personal expenses, including lavish meals, luxury travel and vehicles. https://www.sec.gov/files/litigation/complaints/2025/comp26315.pdf
10. On May 15, 2025, French Hill, Financial Services Committee chairman of the House of Representatives, and Representative Juan Vargas introduced a bill that expands the definition of an accredited investor which would allow investors who demonstrate education, professional experience, or other similar credentials the opportunity to invest in private offerings. On a related matter, the House Financial Services Committee’s Subcommittee on Capital Markets recently held a hearing featuring several proposed related bills, including the Accredited Investor Definition Review Act. The SEC’s current definition of who qualifies as an accredited investor stands at having a net worth over $1 million (excluding their primary residence), plus income over $200,000 (individually) or $300,000 (with spouse or partner) in each of the prior two years, as well as having a reasonable expectation for the same income in the current year.
11. On May 7, 2025 the SEC obtained final judgment against Loral Langemeier and her company, Live Out Loud, Inc. (“LOL”), for selling securities in unregistered offerings, acting as unregistered brokers, and breaching their fiduciary duties as investment advisers by failing to disclose financial conflicts of interest to clients. Langemeier held herself out as a financial expert and, through LOL, developed a roster of clients—mainly small business owners and retirees—who paid fees in exchange for Langemeier’s supposedly objective financial advice. Langemeier convinced many of these clients to liquidate relatively conservative investments, transfer their funds to self-directed IRAs, and purchase securities in risky and unregistered oil and gas securities offerings. Langemeier received hundreds of thousands of dollars in undisclosed compensation in the form of sales commissions when her clients purchased the oil and gas securities, and that she held undisclosed equity interests in certain of the issuers of the securities. Langemeier was ordered to pay disgorgement of $404,807, prejudgment interest of $121,302.28, and a civil money penalty of $50,000. https://www.sec.gov/enforcement-litigation/litigation-releases/lr-26303
12. On May 2, 2025 the SEC obtained final judgments against Safeguard Metals LLC and its owner, Jeffrey Ikahn. The SEC charged Safeguard and Ikahn with operating a multi-million-dollar fraudulent scheme involving the sale of gold and silver coins to hundreds of investors who were at or near retirement age. Safeguard and Ikahn acted as unregistered investment advisers and persuaded investors to sell their existing securities, transfer the proceeds into self-directed Individual Retirement Accounts, and invest the proceeds into gold and silver coins by making false and misleading statements about the safety and liquidity of the investors’ securities holdh3ings, Safeguard’s business, and its compensation. Safeguard and Ikahn was ordered to pay, jointly and severally, $25,569,303 in disgorgement of ill-gotten gains, $4,821,263 in prejudgment interest, and $25,569,303 in civil money penalties. https://www.sec.gov/enforcement-litigation/litigation-releases/lr-26307
13. On May 1, 2025 the SEC charged Derek Taller with engaging in fraudulent conduct while managing and advising two funds, which included making material misrepresentations in offering materials and engaging in self-dealing. Taller served as the principal officer and director of two investment funds, St Health Capital Investment Corporation, at the time a business development company, and Vision BioBanc Holdings, LLC, an unregistered fund. Taller also served as the external investment adviser to each of the funds. Taller disseminated offering documents to prospective investors in Vision Holdings which stated that the fund was supervised by an independent board of directors and its financial statements would be audited by an independent auditor. This matter is being litigated. https://www.sec.gov/enforcement-litigation/litigation-releases/lr-26300
14. On May 1, 2025, the Investment Adviser Association (“IAA”) penned a letter to SEC Chairman Paul Atkins urging the SEC to deploy a flexible, principles-based approach to regulations and the tailoring of its practices to the wide range of more than 16,000 registered investment adviser business models. The IAA routinely identifies important regulatory actions it deems as priorities for the asset management industry and identified eight reforms: Anti-Money Laundering/Customer Identification Programs; Regulation S-P, electronic delivery of regulatory disclosures, marketing rule, Form PF, custody, access to alterative investment products, and pay to play. In its letter, the IAA stated: “We urge the SEC to move away from its recent prescriptive one-size-fits all approach to adviser regulation.”