US securities regulators issue guidance on master/sub-account arrangements *

USA - February 28 2012
U.S. securities regulators have issued a series of alerts and regulatory notices, and have brought several enforcement actions that have focused on master/sub-account relationships.

Co-authors: William Friedman, Matthew P. Truax , Betty Santangelo.

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CFTC finalizes significant rule changes affecting fund managers and investment companies *

USA - February 10 2012
Yesterday, the Commodity Futures Trading Commission ("CFTC") issued a final rule that rescinds the exemption from CFTC registration for commodity pool operators ("CPOs"), which is currently provided in CFTC Rule 4.13(a)(4).

Co-authors: George M. Silfen, Kenneth S. Gerstein, Daniel F. Hunter, Marc Elovitz.

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FINRA proposes to delay implementation date for Rule 5131, but fund managers continue to need information from investors as to restricted status *

USA - May 3 2011
FINRA's Rule 5131 bans a practice known as "spinning" by generally prohibiting a FINRA member from allocating a new issue to any account (e.g., private investment fund) in which an executive officer or director of a public company or a covered non-public company, or a person materially supported by such an executive officer or director (each, a “Rule 5131 Restricted Person”), has a beneficial interest if such Rule 5131 Restricted Person’s company has or expects to have an investment banking relationship with the FINRA member.

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CFTC proposes to discontinue widely-used registration exemptions: private fund general partners and managers may be required to register as commodity pool operators *

USA - March 10 2011
Eight years ago, the Commodity Futures Trading Commission ("CFTC") adopted two exemptions under the Commodity Exchange Act, as amended ("CEA") (Rules 4.13(a)(3) and 4.13(a)(4) the “4.13 Rules”)) that proved to be an efficient way for private investment fund managers to trade commodity interests without registering with the CFTC.

Co-authors: Daniel F. Hunter, Kristin Boggiano, Craig Stein.

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SEC adopts new short-selling restrictions *

USA - February 25 2010
On Feb. 24, 2010, the Securities and Exchange Commission (“SEC”) voted 3-2 to adopt a new rule restricting short selling when the price of a security has dropped more than 10 percent from its prior day’s closing price.

Co-authors: Marc Elovitz, Vivi Mazarakis, J.R. Morgan.

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