The SEC brought an action against LACE Financial for issues with its independence. We also learned that the SEC had investigated whether rating agency Moody’s Investors Service, Inc. violated the registration provisions or the antifraud provisions of the federal securities laws. Moody’s was working on a rating for some new European securities. They ended up … Read more »
Credit Rating Agencies and Conflicts of Interest
Personally, I place a big chunk of blame on the Credit Rating Agencies for the Great Panic of 2008. They were throwing AAA ratings at piles of garbage. There is an inherent conflict in the rater being paid by the security issuer instead of the security purchaser. They are beholden to the customer and the … Read more »
Compliance Bits and Pieces for September 3
You are either getting your kids back to school, enjoying a vacation, or enjoying everyone else being out of the office on vacation. Me? I’m out of the office. There was still some interesting compliance news this past week: SEC employees win battle to dress casual By Zachary Goldfarb for Market Cop Some of the … Read more »
The Trouble with Anonymous Surveys
So how are your surveys working? Do you get meaningful results? Are the results skewed by those who responded (versus those who didn’t)? Read more »
FCPA Release 10-03: Foreign Agents as Foreign Officials
The Department of Justice released its latest FCPA Opinion Release. The requesting company for this opinion release is stepping into a situation full of FCPA red flags. In the end, the DOJ opined that it would not bring an enforcement action based on the safeguards put in place by the company. The company is involved … Read more »
Blatant Self-Promotion
Each year, LexisNexis “honors a select group of blogs that set the online standard for a given industry.” This year, they expanded Top Blogs to include their Business Law Communities. Compliance Building is one of the nominated candidates for the LexisNexis Top 25 Business Law Blogs of 2010, featured on the LexisNexis Corporate & Securities … Read more »
Telling the Truth During Earnings Calls
Is the CEO or CFO lying during the quarterly earnings call? How can you tell? David F. Larcker and Anastasia A. Zakolyukina of the Stanford Graduate School of Business turned to the rich data set of quarterly calls and subsequent financial restatements. After studying Q&A sections of transcripts of hundreds of calls with CEOs and … Read more »
The Second FTC Action for Online Endorsements
Back in December, the Federal Trade Commission released new guidelines that specifically required bloggers to disclose any material connections to a product or company they are writing about. In May, they brought their first action under those guidelines against Ann Taylor. The FTC declined to bring an enforcement action. Last week, they brought their second … Read more »
Book Review: Rewired
I think a big part of compliance is education. It is great to get compliance imposed through internal systems, but you generally need to get the message out to your company about the policies, why they exist, and what they need to do. There is lots of talk about the generation and age group starting … Read more »
Compliance Bits and Pieces for August 27
Here are some recent stories I found interesting: A Red Flag on G.M. Internal Controls by Peter J. Henning in the New York Times’ DealBook General Motors filed its S-1 on Wednesday, and its list of potential risks to the company contains the usual array of obvious market threats and uncontrollable events that might be … Read more »