QUANTITATIVE LIQUIDITY REQUIREMENTS PROPOSED

The US federal banking agencies published a proposed rule that would implement a quantitative liquidity requirement consistent with the liquidity coverage ratio established by the Basel Committee on Banking Supervision. The proposal would apply to internationally active banking organisations – generally bank holding companies, certain savings and loan holding companies, and depository institutions with more than US$250 billion in total assets or more than US$10 billion in on-balance sheet foreign exposure – and to their consolidated subsidiaries that are depository institutions with US$10 billion or more in total consolidated assets. The proposed rule would also apply to companies designated for supervision by the Board by the Financial Stability Oversight Council that do not have significant insurance operations and to their consolidated subsidiaries that are depository institutions with US$10 billion or more in total consolidated assets. The Federal Reserve Board is also proposing a modified liquidity coverage ratio standard that is based on a 21-calendar day stress scenario rather than a 30 calendar-day stress scenario for bank holding companies and savings and loan holding companies without significant insurance or commercial operations that, in each case, have US$50 billion or more in total consolidated assets. Comments should be submitted by 31 January 2014.

OILFIELD SERVICES FIRM SETTLES FCPA CHARGES

Weatherford International has settled charges that it violated the Foreign Corrupt Practices Act by allegedly paying bribes to and authorising improper travel and entertainment for foreign officials in the Middle East and Africa, including the payment of kickbacks in Iraq to obtain United Nations Oil-for-Food contracts. The company allegedly gained more than US$59.3 million in profit from business obtained through improper payments, and more than US$30 million in profit from its improper sales to sanctioned countries. Weatherford agreed to pay more than US$250 million to settle the SEC’s charges and parallel actions by the US Department of Justice’s Fraud Section, the US Attorney’s Office for the Southern District of Texas, the US Commerce Department’s Bureau of Industry and Security, and the US Treasury’s Office of Foreign Assets Control.

PRIVATE INVESTMENT ADVISER FINED FOR COMPLIANCE FAILURES

The SEC instituted settled administrative proceedings against Agamas Capital Management, LP (“Agamas”) for wilful violations of the Investment Advisers Act. Without admitting or denying the allegations, Agamas consented to the entry of an order finding that it failed to adopt and implement written compliance policies and procedures reasonably designed to prevent violations of the Advisers Act concerning the following three areas of private fund management:

  • valuation of fund assets;
  • the accuracy of disclosures to fund investors about the valuation practice; and
  • cross trades between clients. Among other things, the order requires Agamas to pay a civil penalty of US$250,000.