Insurance & Financial Services

Read about recently proposed SEC rules for conflicts of interest in the use of predictive data analytics or similar technologies by broker-dealers and investment advisers.

Registered reps beware: your personal device or messaging account is not the right place to conduct your business affairs, and regulators have made clear that they will not look the other way.  In particular, the Financial Industry Regulatory Authority (“FINRA”) and member firms are cracking down on improper communication recordkeeping practices and the use of non-firm applications, including text messages, to communicate with clients.

Brokers beware: Reg BI is dormant no longer. Last week, the Securities and Exchange Commission (“SEC”) filed its first enforcement action alleging violations of Regulation Best Interest” (“Reg BI”), charging Western International Securities Inc. (“Western”) and five of its registered representatives.

Online broker-dealers can breathe easily in the Commonwealth of Massachusetts once more, as a Massachusetts court last week found a recent regulation imposing a fiduciary duty standard upon brokerage firms to be unlawful.

On November 18, 2021, the Financial Crimes Enforcement Network (FinCEN) issued a Notice “to call attention to an upward trend in environmental crimes and associated illicit financial activity.” This focus on environmental crimes is designed to help address FinCEN’s priorities previously announced on June 30, 2021.

Frank Gerratana discusses the relationship between blockchain and cryptocurrency and the underlying intellectual property issues and opportunities for patent holders.

A Connecticut federal jury just answered one of the biggest questions on the minds of cryptocurrency investors, developers, and regulators – are cryptocurrencies securities? The jury concluded that Paycoin and several cryptocurrency mining-related assets are not securities.

Mintz Members Adam Sisitsky, Nancy Adams, Jack Sylvia and Of Counsel, Kristen White discuss the rising risk of litigation and regulatory enforcement facing SPACs and the individuals that lead them. Topics will included the current SPAC litigation landscape, SPAC M&A–related litigation, including disclosure issues and breach of fiduciary duty in the de-SPAC process, D&O coverage challenges and risk mitigation and heightened SEC scrutiny.

Environmental, social, and governance (“ESG”) investing has experienced quite the regulatory roller coaster in recent years.

Today the Financial Crimes Enforcement Network of the U.S. Department of the Treasury (“FinCEN”) published in the Federal Register a notice framing and seeking comment on key questions about how it will implement the new law requiring domestic and foreign legal entities to report their beneficial ownership to the U.S. government.

The U.S. Securities and Exchange Commission (SEC) recently released its 2021 Examination Priorities. The SEC indicates it will focus on senior investors and those saving for retirement, with a specific focus on potential conflicts of interests faced by brokers and advisors in giving them financial advice.

On January 1, 2021, Congress enacted the National Defense Authorization Act for Fiscal Year 2021 (the “NDAA”), after overriding a presidential veto. Within the NDAA is the Anti-Money Laundering Act of 2020 (the “AMLA”), which introduces substantial reforms to U.S. anti-money laundering (“AML”) and counter-terrorism financing (“CFT”) laws.

Proponents of environmental, social, and governance (“ESG”) investing may have good news on the horizon—in particular, good news that could resuscitate ESG investing in retirement accounts following the Department of Labor’s recent blow to the practice.

In FINRA Regulatory Notice 20-38, FINRA has adopted Rule 3241 to limit registered persons from holding “positions of trust” for clients. The new rule requires that registered persons have written approval from the member firm to act as a trustee, executor, or hold power of attorney for a client account.

In FINRA Regulatory Notice 20-37, FINRA set forth revised Sanction Guidelines that became effective October 20, 2020.

On October 14, 2020, the Consumer Financial Protection Bureau (“ CFPB”) announced a series of organizational changes affecting the Supervision, Enforcement and Fair Lending Division (SEFL), the result of an organizational review that began in February of this year.