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SEC Brings Enforcement Action Against Fund Manager for Single 13D Violation
Harvard Law School Forum on Corporate Governance
October 30, 2020
The SEC brought charges against a fund manager for 13D violations, in yet another reminder that it will pursue enforcement actions against filers for Schedule 13D violations even without a pattern of repeat violations. On Sept. 17, 2020, the SEC announced the settlement of charges brought against an investment manager of certain private funds for failure to timely amend a statement of beneficial ownership report on Schedule 13D. In this article, partner Ele Klein and special counsel Adriana Schwartz and Clara Zylberg outline the implications of the charges and other key takeaways for investment managers.
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On June 28, 2024, the US Department of the Treasury’s Financial Crimes Enforcement Network (“FinCEN”) issued a notice of proposed rulemaking that would amend existing anti-money laundering/countering the financing of terrorism (“AML/CFT”) program[1] regulations to require that financial institutions establish, implement and maintain effective, risk-based and reasonably designed AML/CFT programs with certain minimum components, including a mandatory risk assessment process (hereinafter, “Proposed Rule”).[2] For purposes of the Proposed Rule, “financial institutions” include: banks; broker dealers; mutual funds; futures commission merchants (“FCMs”) and introducing brokers in commodities (“IB-Cs”); insurance companies; money services businesses (“MSBs”); casinos and card clubs; dealers in precious metals, precious stones or jewels; operators of credit card systems; loan or finance companies; and housing government sponsored enterprises.[3] In addition to establishing minimum risk assessment requirements for these AML/CFT programs, the Proposed Rule would require that financial institutions document each component of their AML/CFT programs and make this documentation available to FinCEN or its designee, which can include the appropriate agency to which FinCEN has delegated examination authority,[4] or the appropriate SRO.[5] The Proposed Rule would also require that these AML/CFT programs be approved and overseen by the financial institution’s board of directors or, if the financial institution does not have a board of directors, an equivalent governing body.
Alerts
On June 28, 2024, the US Department of the Treasury’s Financial Crimes Enforcement Network (“FinCEN”) issued a notice of proposed rulemaking that would amend existing anti-money laundering/countering the financing of terrorism (“AML/CFT”) program[1] regulations to require that financial institutions establish, implement and maintain effective, risk-based and reasonably designed AML/CFT programs with certain minimum components, including a mandatory risk assessment process (hereinafter, “Proposed Rule”).[2] For purposes of the Proposed Rule, “financial institutions” include: banks; broker dealers; mutual funds; futures commission merchants (“FCMs”) and introducing brokers in commodities (“IB-Cs”); insurance companies; money services businesses (“MSBs”); casinos and card clubs; dealers in precious metals, precious stones or jewels; operators of credit card systems; loan or finance companies; and housing government sponsored enterprises.[3] In addition to establishing minimum risk assessment requirements for these AML/CFT programs, the Proposed Rule would require that financial institutions document each component of their AML/CFT programs and make this documentation available to FinCEN or its designee, which can include the appropriate agency to which FinCEN has delegated examination authority,[4] or the appropriate SRO.[5] The Proposed Rule would also require that these AML/CFT programs be approved and overseen by the financial institution’s board of directors or, if the financial institution does not have a board of directors, an equivalent governing body.