Suspicious activity reporting. The remarks of US Under Secretary of the Treasury David Cohen were summarized by Reuters. The Financial Crimes Enforcement Network, a unit of the Treasury Department, is drafting rules that would expand the types of firms required to file suspicious activity reports to include, for example, hedge funds. (11/10/2014) Suspicious activity reports.
Criminal securities fraud charges filed against Bitcoin operator. US federal prosecutors filed the first criminal securities fraud charges involving a virtual currency. Trendon Shavers, who founded Bitcoin Savings and Trust (BCS&T), claimed to offer Bitcoin-based investments. Prosecutors allege, however, that Shavers was in reality operating a Ponzi scheme. (11/6/2014) US Attorney press release. The SEC previously obtained civil judgments against Shavers and BCS&T. (9/22/2014) SEC v. Shavers, Lit.Rel.No. 23090.
US regulator to seek comments on investment companies. According toBloomberg, the US Financial Stability Oversight Council will request public input on how the conduct of investment managers may pose a systemic threat. (11/6/2014)FSOC questions.
US states report on enforcement programs. The North American Securities Administrators Association published enforcement data for 2013. Violations by unlicensed persons and entities continue to comprise the highest number of enforcement actions. However, the number of enforcement actions against licensed broker-dealers and their sales representative rose significantly. (11/4/2014) NASAA press release.
Legal Entity Identifier. The Ontario Securities Commission reminded derivatives market participants about the requirement to obtain a Legal Entity Identifier under OSC Rule 91-507 Trade Repositories and Derivatives Data Reporting. The requirement was effective on October 31, 2014. (10/29/2014) OSC press release.
US regulators adopt risk retention requirements. Six US regulators (the Federal Reserve Board, the Department of Housing and Urban Development, the FDIC, the Federal Housing Finance Agency, the OCC, and the SEC), approved risk retention requirements for sponsors of securitization transactions. Under the new rule, sponsors of asset-backed securitizations will be required to retain at least five percent of the credit risk of the assets collateralizing the issuance. (10/22/2014)SEC press release.