• On September 24, 2021, the Staff of the Securities and Exchange Commission (SEC) published a no-action position with regard to the application of Rule 15c2-11 under the Securities Exchange Act of 1934 (Rule) to debt securities.   The no-action position provides a welcome respite to the securities industry as it endeavors to implement organizational and systems changes to achieve compliance with the compliance date of September 28, 2021 for significant amendments to the Rule.  The Staff states that it will not recommend enforcement action to the SEC under the amended Rule "until January 3, 2022 for quotations published by broker-dealers for fixed income securities."

  • Our earlier Client Alert described the amendments to Financial Industry Regulatory Authority (FINRA) Rule 6432 that were adopted in light of the SEC’s amendments to Rule 15c2-11 under the Securities Exchange Act of 1934.   FINRA has issued Regulatory Notice 21-33 to specify its content and filing requirements for the standard Form 211 (filed by broker-dealer members) and the modified Form 211 and daily security file (filed by member Qualified Interdealer Quotation Systems).  

  • Recently there has been considerable discussion, debate, and confusion as to whether Rule 15c2-11 (Rule) under the Securities Exchange Act of 1934 (Exchange Act) applies to debt securities.   Although this article does not address the extent to which Rule 15c2-11 does or should apply to debt securities in general, it does focus on whether the Rule applies to one group of fixed income securities, namely "government securities" as defined in Section 3(a)(12)(A)(i) of the Exchange Act.   It concludes that, based on statutory structure, precedent, and policy, the Rule does not apply to such securities.

  • In the run-up to the September 28, 2021, Compliance Date for the amendments to Rule 15c2-11 under the Securities Exchange Act of 1934 (Exchange Act), the Securities and Exchange Commission (SEC) has approved amendments to Financial Industry Regulatory Authority (FINRA) Rule 6432.   The amendments revise FINRA Form 211 and establish new requirements for "qualified inter-dealer quotation systems" (QIDQS).

  • With the Taliban seemingly in control of Afghanistan, financial institutions and money transmitting businesses will need to revisit their AML and anti-terrorist financing playbooks to avoid sanctions issues with regulators.

  • For some time, there has been a debate about whether digital assets, based on blockchain technology, are a passing fad or a fundamental game changer. A recent survey and report by Deloitte seems to put that question to rest. As the report reads: "Participation in the age of digital assets is not an option – it is inevitable." Thus, key changes to banking and finance must be embraced as the world goes digital. In gathering the data to prepare its report, Deloitte polled a sample of 1,280 senior executives and practitioners in 10 international locations who had at least a general understanding of blockchain, digital currencies, and digital assets. Within that larger group, Deloitte defined two subgroups, Financial Services Industry respondents ("FSI overall") and Financial Services Industry Pioneers ("FSI Pioneers"). It defined FSI Pioneers as those respondents whose organizations have already deployed blockchain solutions into production and/or integrated digital assets into their core business activities.

  • On Wednesday, July 7, 2021, the OCC voluntarily dismissed two individual agency administrative enforcement actions it had brought against two foreign exchange traders, Richard Usher and Rohan Ramchandani, who worked for JPMC and Citigroup, respectively. The OCC had alleged that Usher and Ramchandani had, along with others, conspired together in a chat room (called "the Cartel") from 2007 through 2013, to manipulate prices in the spot forex market. Usher and Ramchandani both asserted that their behavior was accepted industry practice at the time they performed the acts in question.