Mary (Molly) C. Moynihan Partner

As the number of exchange-traded funds (ETFs) continues to grow rapidly across the industry, boards increasingly find themselves at a crossroads in their annual contract review process under Section 15(c) of the Investment Company Act of 1940, as amended (1940 Act), questioning whether they are compelled to consider the delicate question of comparability of fees and other matters between ETFs and mutual funds.

In their third decade of existence, special purpose acquisition companies (SPACs), have gone from novel to ubiquitous. According to the Wall Street Journal, during the first quarter of 2021 alone, SPACs raised nearly $75 billion and accounted for more than 70 percent of all initial public offerings, a 20 percent increase over 2019.

The concept of the blockchain burst into the public consciousness in the latter part of the last decade, as prices of bitcoin soared in a speculative market in which everyone became suddenly familiar with terms like “wallets” and “keys.”

The U.S. Supreme Court recently cast doubt on the criminal convictions of the one-time “King of Political Intelligence” David Blaszczak and three others for their role in an insider trading scheme.

The recent advent of non-transparent, semitransparent, and other actively managed exchange traded funds (ETFs) within existing mutual fund complexes raises the issues discussed below that the boards of mutual funds in such complexes currently face.

In light of the recent novel coronavirus (COVID-19) outbreak and the challenges it presents for boards of directors to safely travel, the SEC issued an order on March 13, 2020, exempting all registered investment companies and business development companies, including their advisers and principal underwriters, from the in-person meeting requirements of certain provisions under the Investment Company Act of 1940.

The U.S. Court of Appeals for the Second Circuit issued an opinion in United States v. Blaszczak on December 30, 2019 that could significantly affect the prosecution of criminal insider trading cases.

In August 2019, investments in passive funds surpassed those in traditional actively managed funds for the first time. According to Morningstar, assets in index-tracking US equity funds grew to about $4.27 trillion, compared with almost $4.25 trillion in funds managed by active managers.

The SEC held an open meeting on August 21, 2019, and approved two items: (1) guidance regarding the proxy voting responsibilities of investment advisers under the Investment Advisers Act of 1940 and related proxy voting disclosures required under the Investment Company Act of 1940; and (2) interpretation and guidance on the applicability of rules on proxy voting advice under the Securities Exchange Act of 1934. 

The SEC’s Division of Investment Management has relaxed certain in-person voting requirements for fund boards, subject to certain conditions, in a no-action letter to the Independent Directors Council (the IDC) issued on February 28, 2019.

Four Perkins Coie LLP attorneys discuss the recent charges led against Rep. Chris Collins. The authors note that the case is a useful reminder of the duties owed by board members, the potential liability of non-trading tippers, and exposes potential conflicts of interest when members of Congress have significant outside interests.

Recent buzz around cryptocurrency, initial coin offerings (ICOs), and blockchain technology has sowed confusion among many market participants about the impact of this new technology on the asset management industry. This article discusses the current regulatory state of play and how this innovative technology is likely to play out in the registered funds space. 

Over the past decade, the mutual fund industry has changed in myriad ways. A once stodgy industry, with relatively little innovation in marketing or product line, has begun to experience and respond to significant disruption.

This article explores the factual and legal contours of SEC administrative settlements with a fund administrator, as well as related enforcement actions against investment managers, to better understand the affirmative steps the SEC is expecting financial service providers to take to help root out fraud and misappropriation in the financial services sector.

Less than two decades ago, fund groups wrestled with whether it was worthwhile to create websites.

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The SEC’s Division of Investment Management issued a no-action letter on January 11, 2017 explicitly permitting brokers to set their own commission rates for sales of so-called “clean shares” of mutual funds.

The SEC announced two administrative settlements in June, with a fund administrator that provided accounting and fund administration services to several private funds based on its alleged failure to heed red flags and correct faulty accounting by two private fund managers.

This update was republished in the Journal of Investment Compliance May 2017 issue, " SEC Charges Private Fund Administrator With Gatekeeping Failures ."

This updated fifth edition provides detailed guidance for compliance with the suite of laws that impact federal government relations professionals. It provides practical examples of how to be compliant, and covers all of the major federal statutes and regulations that govern the practice of federal government relations work.

The Investment Company Institute’s annual Mutual Funds and Investment Management Conference heralded springtime and a fresh approach to the regulation of registered funds. 

The SEC’s recent aggressive enforcement posture against chief compliance officers has raised many concerns, including whether the SEC’s actions are actually chilling robust compliance efforts.

This update was featured in Today's General Counsel on 03.17.2016 as "Is SEC Monday Morning Quarterbacking, By Targeting Compliance Officers?"

Suffice it to say, cybersecurity has been a hot topic in the mutual fund industry during the past year. 

The Investment Management Report provides information on recent changes in the financial industry. Read the full newsletter.

The Investment Management Report provides information on recent changes in the financial industry. Read the full newsletter.

The Investment Management Report provides information on recent changes in the financial industry. Read the full newsletter.

The Investment Management Report provides information on recent changes in the financial industry. Read the full newsletter.

At an open meeting of the Securities and Exchange Commission (SEC) on June 23, 2011, the SEC Commissioners approved a new rule defining “family offices.” Title IV of the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act) excluded family offices from the definition of investment adviser under the Investment Advisers Act of 1940 (Advisers Act) and thereby exempted family offices from the registration requirements under the Advisers Act, as amended by the Dodd-Frank Act. However, Section 409 of the Dodd-Frank Act also directed the SEC to adopt a rule defining the term “family office” in order to identify the entities eligible for the exclusion. On June 23, 2011, the SEC adopted such a rule.

On November 19, 2010, the Securities and Exchange Commission released two companion releases proposing new rules related to registration requirements for investment advisers to private funds, including hedge funds, private equity funds and other pooled investment vehicles.

On November 19, 2010, the Securities and Exchange Commission proposed a new rule, based on requirements under the Dodd-Frank Wall Street Reform and Consumer Protection Act, or the Financial Reform Act, defining “venture capital funds” for purposes of exempting advisers to these funds from registering under the Investment Advisers Act of 1940.