Month: November 2011

Failure to Adequately Oversee Service Providers

Citing what it called “wholly inadequate” oversight of a faraway subadviser, the Securities and Exchange Commission fined and ordered repayment of advisory fees by Morgan Stanley Investment Management. According to the settlement, Morgan Stanley will repay its client, the Malaysia Fund, $1.8 million for fees it paid from 1996-2007 for “research, intelligence, and advice” that 

Three Compliance Failures

One for the money, two for the show, three because uh – uh, comes before four, and here we go!  – Tigger On Monday, the Securities and Exchange Commission announced not one, not two, but three actions against investment advisers for failing to put in place compliance procedures designed to prevent securities law violations. The

Compliance Officer Banned in the United Kingdom

As a compliance officer, I often find that many lessons come from enforcement actions. Those actions imposed on compliance officers are especially instructive. The latest to catch my attention comes from the United Kingdom. The Financial Services Authority levied a £14,000 fine and banned a compliance officer from performing any significant influence function in regulated

Compliance Bits and Pieces for November 18

These are some recent compliance related stories that caught my attention: Where the Bribes Are by the James Mintz Group The Foreign Corrupt Practices Act, passed in 1977, has led to more than 200 cases covering activity in about 80 countries. On this map, the darker red that a country appears, the larger the total

Boomerang – Michael Lewis Looks at the New Third World

Michael Lewis packages his stories on the effects of the global financial crisis in Iceland, Greece, Ireland, Germany, and California into one book: Boomerang. If you had ready the stories when they were published in Vanity Fair, then you’ve ready the book. If you missed some (or all) of those stories then this book is

Salute a Veteran

U.S. President Woodrow Wilson first proclaimed an Armistice Day for November 11, 1919. “To us in America, the reflections of Armistice Day will be filled with solemn pride in the heroism of those who died in the country’s service and with gratitude for the victory, both because of the thing from which it has freed

Massachusetts Revises Proposed Private Fund Adviser Exemption

From my discussions, many real estate fund managers are still not sure if they are subject to registration under the Investment Advisers Act. The definition of “private fund” can exclude many real estate funds depending on the structure of their investments. I think the result is that you end up under the federal level of

Form ADV, Valuations, and Timing for New Registrations

With hundreds (thousands?) of private fund managers set to register with the Securities and Exchange Commission next quarter, the new form ADV is on the IARD system and ready for you to start uploading information. I noticed the first problem. Question 5 asks you to “determine your regulatory assets under management based on the current

SEC Says it is Bringing Charges Against Wall Street

You’ve probably heard the charges made by politicians and activists that the Securities and Exchange Commission is ineffective and not bringing charges against those who caused the 2008 financial crisis. “YOU’RE WRONG!” says the SEC. The SEC has begun publishing “Enforcement Actions Addressing Misconduct That Led to or Arose From the Financial Crisis.” Key Statistics