SEC Approves Registration Rules for Municipal Advisors

On September 18, the SEC unanimously adopted permanent registration rules for municipal advisors as required by the Dodd-Frank Act.  The new rule requires an advisor to permanently register with the SEC if it provides advice to state and local governments on the issuance of municipal securities, about certain “investment strategies,” or on municipal derivatives.  The new rules will supersede current temporary registration rules and will become effective 60 days after they are published in the Federal Register.  Press Release.

Orrick Alert: Second Circuit Decision on Extraterritoriality

On August 30, the United States Court of Appeals for the Second Circuit handed down its decision in United States v. Vilar, which unequivocally limits the U.S. government’s ability to use Section 10(b) of the Securities Exchange Act of 1934 in criminal prosecutions involving extraterritorial conduct. No. 10-521-CR (2d Cir. Aug. 30, 2013).  In so doing, the court made clear that the Supreme Court’s territorial limitation on private securities fraud actions, originally set forth in Morrison v. National Australia Bank Ltd., 130 S. Ct. 2869 (2010), also applies to criminal prosecutions.  While the Dodd-Frank Act may in the future affect the scope and longevity of the Vilar decision, at least for the time being, Vilar makes it all the more difficult for U.S. prosecutors to pursue securities fraud where the purchase or sale of securities occurred outside the U.S.  For the complete Orrick alert, please click here.

CFTC Final Rules on Registration and Operation of SEFs

On May 17, pursuant to Sections 721, 723 and 733 of the Dodd-Frank Act, the CFTC approved final rules governing the registration and operation of swap execution facilities (SEFs).  The final rules implement the Dodd-Frank Act’s new statutory framework that, among other requirements, adds a new Section 5h to the CEA regarding the registration of SEFs and adds a new Section 2(h)(8) to the CEA concerning the execution of swaps on SEFs.  The final rules will become effective 60 days following publication in the Federal Register; however, compliance is required with most provisions of the final rules 120 days following publication.  CFTC Fact SheetCFTC Final Rule.

Fed, Treasury Proposed Amendments to Bank Secrecy Act Definitions

On November 29, the Fed and the Financial Crimes Enforcement Network, a bureau of the Treasury, proposed amended definitions of “funds transfer” and “transmittal of funds” under the regulations implementing the Bank Secrecy Act.  The proposed amendments maintain the current scope of funds transfers and transmittals subject to the Bank Secrecy Act following amendments to the Electronic Fund Transfer Act made pursuant to the Dodd-Frank Act.  Comments must be submitted no later than January 25, 2013. Fed Release.   Fed Proposed Rule.