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Conflicts Ahead – What Can We Learn From the Early Days of the Trump Administration

President Trump has come into office as the first president in modern era to own an active business empire. One in which his name is the probably the most valuable asset. Like him or not; voted for him or not; He is the President. As we have seen in the past, scandals limit the ability […]

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The SEC Really Means It About Pretaliation Severance Agreements

In case you were not clear that the Securities and Exchange Commission is serious about enforcing Rule 21F-17, BlackRock is the latest to run the perp walk. The SEC accused the money management giant of improperly using separation agreements that forced employees to waive their ability to obtain whistleblower awards. The SEC adopted Rule 21F-17, which provides in […]

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A New Level of Compliance Officer Concern: Getting Arrested

Oliver Schmidt is the former top emissions compliance manager for Volkswagen in the United States. The FBI arrested him on Saturday as part of the Volkswagen emissions scandal. He was denied bail, pending a court appearance later this week. Perhaps, the case is not one of a compliance officer missing a problem, but a compliance […]

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Draining the Swamp?

One of the rallying cries for President-elect Trump was to drain the swamp of corruption. Compliance professionals could think of many things that could happen to remove conflicts or the appearance of conflicts. Personally, as a compliance professional and a voter, I was disappointed to learn that Hillary Clinton did a poor job of walling […]

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Return of the Whistleblower

It’s been a busy week for whistleblower cases. The latest is a case against SandRidge Energy for using severance agreements that impeded employees from contacting the Securities and Exchange Commission. In response to Dodd-Frank, the SEC adopted Rule 21F-17 in August 2011, which provides: (a) No person may take any action to impede an individual […]

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custody and private funds

Co-investments and Conflicts

I have seen a few indications from the Securities and Exchange Commission showing that examiners are concerned about co-investments. I have yet to see a large over-arching activity in the industry that has been identified as problematic. I saw an action last week for a fund advisor related to co-investments so it caught my eye. Upon […]

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exxon square

Compliance and Conflicts with Exxon Mobil and the Trump Administration

President-Elect Trump has many conflicts of interest as he prepares to take office. It’s been a long time since the president-elect has been so deeply involved in a active businesses. His appointment of Rex Tillerson as Secretary of State creates another batch of conflicts for the administration and for Exxon-Mobil. As is typical with many […]

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ferrari square

What Kind of Car Does Your Fund Manager Drive?

In a new paper, researchers found that hedge fund managers who own powerful sports cars take on more investment risk and are more likely to engage in fraudulent behavior. The inverse is also true: Drivers of minivans tend to deliver less volatile returns, according to the study. “Specifically, sports car drivers deliver returns that are […]

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Cash in the grass with room for your type.

“May” or “Will” is Less Important Than Completeness

The Robare case popped to my attention last year because the Securities and Exchange Commission was focused on the use of the word “may” instead of “will” as adequate disclose of a fee arrangement. My eyes rolled at such distinction. The administrative law judge felt the same way and dismissed the case. Now the Commission […]

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Politics and Conflicts of Interest

Politicians and their staff are prone to conflicts of interest. Legislative, executive, and regualtory actions will affect the value of companies and their investors. Hillary Clinton failed to address the conflicts between her actions as Secretary of State and the fundraising of the Clinton Foundation. One of the campaign promises of Donald Trump was to tackle […]

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