Enterprise 2.0 Conference in Boston

Next month, I’m attending the Enterprise 2.0 Conference happening June 14-17 at the Westin Boston Waterfront. This will be fifth Enterprise 2.0 conference: 2007, 2008, 2009, 2009 San Francisco.

I’ll be talking about social media policies with these folks:
  • Mike Gotta, Principal Analyst, Burton Group
  • Bruce Galinsky, IT Director, Global Insurance Company
  • Abha Kumar, Principal, Information Technology, Vanguard
  • Alice Wang, Senior Consultant, Burton Group

Social Media Policies: Practical Advice From The Trenches

Wednesday, June 16 1:00 PM–2:00 PM – (Location: Grand Ballroom D)
Policy formation, governance and risk management programs are a critical requirement as organizations assess implications to the enterprise (e.g., identity assurance, data loss, compliance, e-Discovery, security), arising from internal and external use of social networking and social media. This panel of social media and Enterprise 2.0 practitioners will discuss real-life approaches that address management concerns.

If you’re looking for a discount, PB Works is offering a discounted pass. You can get 30% off a conference pass or a free Expo pass. Register and use the priority code: CNRREB33.

While you’re there, visit PB Works in Booth 609.

(Disclaimer: I’m on an advisory board for PB works.)

About The Enterprise 2.0 Conference
The Enterprise 2.0 Conference explores the integration of Web 2.0 technologies in the enterprise, from both strategic and tactical perspectives. This annual conference and sponsor pavilion focuses on the tools and techniques that best leverage the technical, productive and social aspects of IT and workgroup environments to build a cohesive collaboration strategy and empower a connected workforce. For more information visit: www.e2conf.com.

Financial Reform Passes the Senate

House Financial Services Committee Chairman Barney Frank (D-MA) issued the following statement on the passage of the Financial Stability Bill:

“I congratulate Senator Dodd on an impressive act of legislative leadership, and I also congratulate Majority Leader Reid for pushing this through. The two bills are very similar, and the House is ready to go to conference to work out the remaining issues. I am confident that we can have a bill ready for President Obama’s signature very soon.”

It’s going to take a while to get through all of amendments to the bill to figure out what changed. (Over 400 were proposed.) Senator Dodd still can add a “manager’s amendment” which is supposed to only make technical changes, but often has substantive changes.

As my Congressman Frank states, the House and the Senate need to hash out a compromise bill that both can pass.

The New York Times has a great chart highlighting some of the differences on the big items.

Compliance Bits and Pieces for May 21

Here are some compliance related stories that caught my eye recently:

The annotated MBA oath by Alex Beam in the Boston Globe

How does a pledge of honor fit into today’s business world? Just read between the lines.

FCPA Red Flags, Hewlett-Packard and Big Papi by Tom Fox

Recently, commentator and former big league manager, Buck Showalter discussed the current batting slump of Big Papi, David Ortiz, by noting that his inability to hit the off-speed was a Red Flag for what is really ailing him, decreased bat speed. Showalter explained that the reason Big Papi’s failure to hit a curve ball was a Red Flag which indicates a bigger problem; Ortiz has to amp up to hit a fastball so much now that he is susceptible to being quite easily fooled by an off-speed pitch. In the FCPA compliance world a Red Flag can also be equally indicative of a larger problem.

Private Equity Council issues statement on proposal to raise taxes on growth investments

“At this time of great market uncertainly, now is not the time to upend more than 50 years of partnership tax law characterizing carried interest as a capital gain. This punitive, 157 percent tax hike on growth investment by real estate, venture, private equity and other firms will hurt those companies that are most desperately in need of capital to sustain or create jobs and drive growth.”

Why E.D. Va. Has Jurisdiction Over Fraud at Public Cos. by Bruce Carton for Compliance Week‘s Enforcement Action

So why is Mr. MacBride gearing up in this way? Mr. MacBride, didn’t you hear that Northern Virginia never quite became the “Silicon Valley of the East” as was hoped back in 2000? Actually, it turns out that MacBride’s plans have nothing to do with companies headquartered or even doing business in Virginia. Rather, MacBride asserts that his office has jurisdiction over most securities fraud because the SEC’s EDGAR database is physically housed in Alexandria, Va. That means that every publicly traded company technically makes their SEC filings in his district.

New Survey Studies Social Media Use by General Counsel by ALM Legal Intelligence

The survey of the social media habits of 164 in-house counsel was conducted by Greentarget Strategic Communications, ALM Legal Intelligence and Zeughauser Group. The survey reveals that sophisticated purchasers of legal services in major corporations increasingly are influenced by attorney-authored blogs in forming opinions that influence law firm hiring decisions. Additionally, nearly 70 percent of respondents aged 30 to 39 expect their consumption of business and legal industry news through social media platforms to increase within the next six months.

Attorney General Eric Holder at Boston University School of Law’s Convocation

Dean O’Rourke, distinguished faculty, proud parents, family, and friends, and, above all, members of the class of 2010. I am proud to salute you. And I am honored to stand with you on the day that, more than any other, marks the start of your journey of service to the law – and to the people it protects and empowers.

Martindale-Hubbell Connected Redesign

Lexis-Nexis gave a sneak peak of some upcoming changes to their Martindale- Hubbell Connected social network site for lawyers.

They cleaned up the user interface, with new colors, improved navigation and improved searching.

The current Connected site has been a disappointment. I have a lot of hope for the site because it has the financial backing of Lexis-Nexis and the ginormous content repository of Lexis-Nexis.

They are trying to better combine the public lawyer directory from Martindale.com to the Connected social network. That means they are also redesigning Martindale.com

One surprise was the inclusion of third party advertising. There was an ad for the  Cadillc SRX prominently on the page during part of the demonstration. (I wonder what Paul Lippe would think about placing advertisements in Legal OnRamp.)

They are also creating a subscription model so that you need to pay for access to the full features of the site. It sounds like you get full access to Connected if you have a subscription to Martindale. They were dodgy on the details during the demo. You need to be a premium member to create a group and to send messages to people that you are not “connected” to.

The site will try to push content to you based on you interests. Supposedly the more complete your profile, the better focused the information that will be pushed to you.

They added a “Diversity Information” section, sponsored by the Minority Corporate Counsel Association.  (Unfortunately, there is not much there for a white guy like me.)

The Martindale Peer Review gets a prominent display and lots of detail on how the rating was compiled. That may resuscitate lawyers’ interest in paying for that AV or BV rating.

They are continuing the emphasis on groups within the community. They went a step further and allowed for subgroups within groups. Personally, I think the use of groups is over-emphasized, merely leading to fragmented content. Groups are great for focusing an filtering information. You only need to filter when there is a big flow of information. Connected has too little information flowing to need many filters. LinkedIn had groups for a long time that merely acted as profile badges. Even now that LinkedIn groups can have substantive discussions, most are filled with self-promotion and spam.

They are also changing the privacy, allowing non-members to see the content in public groups and allowing Google to index the public groups. (I’m not sure there is much content to index.)

The redesign is scheduled to be deployed on June 2.

Update on the Social Media Policies Database

My social media policies database is now up to 162 policies. I troll the internet periodically to add new policies as they become public.

If you are looking to draft your own social media policy, the policies in the database are a good place to start.

Currently they are organized into these industries

  • Education (5)
  • Financial (2)
  • Government (40)
  • Healthcare (17)
  • Law Firm (3)
  • Media (18)
  • Non-profit (11)
  • Professional services (16)
  • Retail (10)
  • Sports (3)
  • Technology (24)
  • Utility (1)

Plus, there are a 10 generic templates.

Clearly, government is over-weighted in the database. Is it because government bodies are ahead of private industry when it comes to creating social media policies? I doubt it. I think they are just more likely to publish the policy or otherwise make it publicly available.

If you want to contribute a policy to the database, you can use the form below.

Social media bandwagon image is by Matt Hamm under a creative commons license.

.

Dodd Bill, Private Placements and Accredited Investors

I previously wrote about how the Restoring American Financial Stability Act being tossed around in the Senate could affect private investment funds by changing the definition of accredited investor and altering the process for a Regulation D private placement.

It looks like much of that is going to be wiped out of the bill. Senate Amendment 4056, proposed by Senator Bond, was passed by a voice vote.

The amendment directs the SEC to adjust the net worth needed to attain accredited investor status to $1,000,000, excluding the value of the primary residence. Within the period of four years after enactment, however, the net worth standard must be $1,000,000, excluding the value of the primary residence. The proposal would give the SEC the power to adjust the the definition of “accredited investor” every four years.

Senate Amendment 4056 also removed the 120 review period for private placements.

I have found Senate process for dealing with financial reform bill to be incredibly opaque and fast moving. There have been almost 400 amendments proposed since the bill was submitted last month, with the text of most of the amendments not being available until after vote has taken place.

Sources:

Private Investment Funds and Form 5500 Schedule C

If you have ERISA plan investors in your private investment fund you should know that they have new reporting requirements this year.

There is a new rule that requires greatly expanded disclosure of monetary and non-monetary compensation paid by the ERISA plan. On Schedule C to Form 5500, the plan will need to identify any service provider who received more than $5,000 in compensation. In prior years, ERISA plan administrators were only required to identify the plan’s 40 most highly compensated service providers who received at least $5,000.

Mutual funds, hedge funds, private equity funds and funds of funds are all considered service providers. If you have an ERISA plan invested in your fund, expect a request for information on fees.

In the case of registered mutual funds, compensation paid to persons who rendered services to the plans investing in the fund is reportable. These expenses include investment management fees and fees related to the purchase or sale of interests in the fund. Amounts charged against the fund for “other ordinary operating expenses,” such as brokerage commissions paid to a broker in connection with a securities transaction within the fund’s portfolio, would not be deemed indirect compensation to a service provider and would not be reportable.

Fees received by third parties from an operating company in which a plan invests, including a venture capital operating company (VCOC) or a real estate operating company (REOC), generally would not be reportable indirect compensation according to the DOL’s FAQ on Form 5500 Schedule C:

Q7: Is compensation received in connection with the management and operation of venture capital operating companies (VCOCs), real estate operating companies (REOCs), and other operating companies reportable indirect compensation?

No. Although the requirement to report indirect compensation is not limited to fees received by persons managing plan assets, unlike investment funds (e.g., mutual funds, collective investment funds), fees received by third parties from operating companies, including real estate operating companies (REOC) or venture capital operating companies (VCOC), in connection with managing or operating the operating company, generally would not be reportable indirect compensation. Fees or commissions received by an investment manager or investment adviser in connection with a plan investment in a VCOC, REOC, or other operating company would, however, be reportable indirect compensation. This answer would not be affected by whether the VCOC, REOC, or other operating company were wholly owned by a plan such that the assets of the entity would be deemed to be plan assets.

ERISA is a complicated law. Make sure you find someone to help you answer these questions.
Sources:

Cash, Ash or Crash – Nobody Rides for Free

Iceland has been a sources of trouble.

In October of 2008 their banking system crashed after ill-advised over-expansion. Proportionally, Iceland’s financial meltdown made the US failure look quaint. The three biggest banks in Iceland, a country of only 310,000, made loans totaling over 850% of Iceland’s Gross Domestic Product.

In April, Iceland’s Eyjafjallajökull volcano erupted from its glacial hibernation. The result was the biggest shutdown in the history of aviation. (This included the flight for my planned vacation.)

Last week Iceland’s Glitnir Bank announced that it has commenced legal action in the Supreme Court of the State of New York against Jon Asgeir Johannesson, formerly its principal shareholder, Larus Welding, previously Glitnir’s Chief Executive, Thorsteinn Jonsson, its former Chairman, and other former directors, shareholders and third parties associated with Johannesson, for fraudulently and unlawfully draining more than $2 billion out of the Bank.

They are also suing the bank’s auditors PricewaterhouseCoopers for malpractice and negligence. The bank claims that PwC helped conceal the fraudulent transactions that lead to Glitnir’s collapse. “The Individual Defendants could not have succeeded in their conspiracy to loot Glitnir without the complicity of Glitnir’s outside auditors at PricewaterhouseCoopers hf.”

It’s curious that the action was filed in New York state court. I assume there will be a big battle over jurisdiction. After all, it’s an Icelandic bank, Icelandic defendants, and even claims under Icelandic statutory law.

The bank is claiming jurisdiction in New York because Glitnir sold $1 billion in medium term notes to US investors in September 2007. Plus Johannesson and his wife reside in New York (I don’t think that helps much with the other defendants.) The complaint also points out that many of the contracts involved in the fraud had New York choice of law provisions.

The question will be whether Icelend’s volcanic will prevent the defendants from traveling to New York.

The title of this post comes from Jim Peterson as his update of the 1970s hitchhiker bumper sticker.

Sources: