Amy Lynch on cybersecurity failures revealed in SEC case (IGNITES – Subscription Req’d)

Founder and President Amy Lynch discusses a recent SEC Enforcement action highlighting the importance of cybersecurity policies and processes that are custom-tailored to a firm’s business model, in this case an indie firm. In addition to leveling SafeGuards Rule violations, the SEC charged a firm for the first time under the 2013 Identity Theft Red…

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Timing of investment consultants’ removing managers raises questions; Amy Lynch comments (FundFire – Subscription Req’d)

Whether investment consultants inform clients of status changes with their money managers may well depend on the consultants’ policies or the specific reasons for removal. The consensus is that informing clients of manager line-up changes is a best practice to maintain good relationships. However, there are compliance considerations on the timing of the manager removal…

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When employee misconduct outside the office creates reputational risk for firms; Amy Lynch explains (IGNITES – Subscription Req’d)

A recent SEC settlement with affiliates of a large insurance and asset management firm highlights how an employee, charged with criminal offenses outside the office, can negatively impact their employer during an SEC investigation. During its review of faulty research models relied on by certain investment products offered, the SEC cited the models’ numerous errors…

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SEC draws the line on marketing with backtested data; Amy Lynch comments (IGNITES – Subscription Req’d)

A recent SEC order highlighted the regulator’s stance on hypothetical backtested data used in marketing materials. The SEC cited a large fund manager for failures to include adequate disclosures, misrepresentations and lack of compliance coordination as related to backtested performance data used in certain marketing pieces. Founder and President Amy Lynch commented that the use…

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ComplianceAlert

NFA Requires New Disclosures for Virtual Currency Activities

Effective October 31, 2018, the NFA is requiring new disclosures for CPOs and CTAs under NFA Compliance Rule 2-4 and Rule 2-29. The disclosures, outlined in NFA Interpretive Notice 9073, specifically relate to those CPOs and CTAs engaged in virtual currency activities. This comes on the heels of the new Memorandum of Understanding (MOU) between…

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