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Tag Archives: fund regulation

Commissioner Piwowar Slams “Dodd-Frank Politburo” for Overstepping Authority

Posted in Fund Regulation

In a speech on July 15, 2014, SEC Commissioner Michael S. Piwowar expressed his views about the Financial Stability Oversight Council (FSOC) operating in secrecy as it tries to expand its regulation of financial institutions and the capital markets. Commissioner Piwowar opened his speech with a number of phrases about FSOC, calling it, among other… Read More

SEC Staff: Measure Percentage Ownership by Fund, not by Complex

Posted in Fund Regulation, Investment Adviser Regulation

In its June 2014 Guidance Update, the SEC’s Division of Investment Management said that series funds are individual investment companies for purposes of compliance with certain investor protections, including the 1940 Act’s restrictions on principal transactions. Section 17(a) of the 1940 Act generally prohibits an “affiliated person” of a mutual fund, or an affiliated person… Read More

Banking Regulators: Exit Fees for Bond Mutual Funds?

Posted in Fund Regulation

Should federal regulators impose exit fees on bond funds?  Officials at the Board of Governors of the Federal Reserve may think so. The Financial Times reported on June 16, 2014 that Fed officials have discussed whether regulators should impose exit fees on bond funds to avert a potential run by investors.  The regulators apparently are… Read More

SEC Staff Urges Bond Fund Advisers to Reassess Risk Management in Light of Market Volatility

Posted in Fund Independent Directors, Fund Regulation

The SEC’s Division of Investment Management recommends that fixed income fund advisers take steps to assess portfolio risk in light of “potential market volatility” and review the adequacy of related prospectus disclosures. In particular, the staff suggests that fund advisers “consider taking” the following steps: Assess and stress-test liquidity during normal and stressed environments, taking… Read More

“Guaranteed!” “Protected!” Blog Entry on Fund Names

Posted in Fund Regulation, SEC Enforcement

The SEC’s Division of Investment Management is cracking down on funds that use names that suggest safety or protection from loss. In Guidance Update No. 2013-12, the staff stated that fund names suggesting safety or protection from loss may contribute to investor misunderstanding of investment risks.  The staff said that it recently requested that some… Read More

No-Action Relief Allows Business Development Companies to Hold Shares of Affiliated Advisers

Posted in Fund Regulation, Investment Adviser Regulation

In two recent no-action letters, the SEC staff expanded the ability of business development companies (BDCs) to invest in registered investment advisers.  Although Section 12(d)(3) of the Investment Company Act of 1940 generally prohibits a registered investment company – including a closed end fund that elects to be treated as a BDC – from acquiring… Read More

SEC Steps into Fund Boardroom Once Again; Charges Adviser with Misleading Board

Posted in Fund Independent Directors, Fund Regulation, Investment Adviser Regulation, SEC Enforcement

The SEC charged a registered investment adviser and its principal with misleading a mutual fund’s board about the adviser’s portfolio management trading capabilities.  The SEC said the adviser misled the board at two meetings when the board considered and approved the investment advisory contract between the fund and the adviser.  In addition, the SEC claimed… Read More