Last week was a busy one at the SEC
and for fundsters who pay close attention to every move made by Mary Jo White
and her staff. The upshot for fundsters is mixed.
| Mary Jo White|
Securities and Exchange Commission
On the plus side, the SEC's in-house courts may be about to get a lot friendly to fundsters and others targeted by the regulatory agency. After another courtroom setback
in the fight over the in-house courts, last Thursday SEC Chair White and her fellow commissioners proposed
a host of changes to what it calls its "administrative proceedings", including giving defendants more time to prepare their defense and the opportunity to depose witnesses during discovery, before the actual hearing.
and the Wall Street journal
covered the proposal.
On the minus side, last Monday the SEC smote
its first "Distribution in Guise" target, to the tune of a $40-million settlement. And last Tuesday White followed through
on her 2014 promise
to push new liquidity management regulations for mutual funds and ETFs. As predicted
by SEC watchers earlier this month, the unanimously-approved proposal would allow funds to use "swing pricing" to penalize stampeding investors who all try to exit or enter the fund at the same time. And it would require funds to "implement liquidity risk management programs".
), ETF Trends
, the Financial Times
, Pensions & Investments
, and the Wall Street Journal
all covered the new liquidity risk management proposal.
So, be careful how you pay for distribution and prepare to do more planning and paperwork around liquidity, but also enjoy more time and preparation to defend yourself or your employer if the SEC ever comes a-knocking in an unfriendly way.
Neil Anderson, Managing Editor
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