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☆ U.S. SEC stepped up enforcement activity in fy2022, assessed record penalties
▼ + stars: | 2022-11-15 | by ( John Mccrank | ) www.reuters.com time to read: +2 min

The total assessed included a record $4.2 billion in civil penalties, up from a total amount of $3.6 billion in 2021, as it filed 760 total enforcement actions, including 462 new or stand-alone ones. The SEC chair previously announced the amount of fines and fees assessed, but the annual report published on Wednesday provided more details in its roundup of activity in the year ended Sept. 30. SEC actions against JP Morgan Securities LLC, 15 other broker dealers, and one investment adviser for widespread and long-standing failures to maintain and preserve work-related text messages conducted on employees' personal devices made up over $1.2 billion of SEC penalties in 2022. The SEC also filed charges against Deloitte's China-based affiliate of failing to comply with U.S. auditing requirements and secured a record penalty against crypto firm BlockFi for selling unregistered securities. Reporting by John McCrank in New York; Additional reporting by Chris Prentice; Editing by Jonathan OatisOur Standards: The Thomson Reuters Trust Principles.

☆ S&P Global Ratings to pay $2.5 mln to settle U.S. regulator charges
▼ + stars: | 2022-11-14 | by ( ) www.reuters.com time to read: +1 min

WASHINGTON, Nov 14 (Reuters) - S&P Global Ratings agreed to pay a $2.5 million penalty to settle U.S. Securities and Exchange Commission charges that it violated rules to prevent conflicts of interest, the regulator said in a statement on Monday. S&P employees ran afoul of rules designed to prevent sales and marketing considerations from influencing credit ratings determinations during a five-day period in August 2017, the SEC said. S&P commercial employees attempted to pressure colleagues responsible for evaluating and assigning a rating to a jumbo residential mortgage-backed security transaction by an issuer in July 2017. The firm's commercial employees "became participants in the rating process during a time when they were influenced by sales and marketing considerations," the regulator said in its statement. Ratings agencies, which are registered with SEC, are required to keep all sales and marketing considerations from affecting credit ratings.

☆ Crypto clearinghouse LedgerX withdraws FTX's request last year to CFTC
▼ + stars: | 2022-11-14 | by ( ) www.reuters.com time to read: 1 min

Nov 14 (Reuters) - Digital currency futures and options clearinghouse LedgerX LLC submitted to the U.S. Commodity Futures Trading Commission a formal withdrawal of FTX's request from December last year that sought to allow the crypto exchange to offer products that are not fully collateralized. Reporting by Chris Prentice in Washington and Mehnaz Yasmin in BengaluruOur Standards: The Thomson Reuters Trust Principles.

☆ Manhattan U.S. attorney's office investigates FTX downfall - source
▼ + stars: | 2022-11-14 | by ( ) www.reuters.com time to read: +1 min

The downfall followed a failed rescue deal with rival exchange Binance, with FTX now facing scrutiny from U.S. regulators over its handling of customer funds, as well as its crypto-lending activities. The Manhattan U.S. attorney's office declined to comment. Reuters reported last week that at least $1 billion of customer funds have vanished from FTX, citing sources. But the bigger blow to digital assets came since FTX, which had developed a penchant for bailing out troubled crypto firms, showed early cracks. "The FTX crash spotlighted well-known structural issues in the crypto ecosystem: insufficient reserves, conflict of interest, a lack of regulation and transparency, and unreliable data."

He is seeking the remainder from other funds, including current investors in FTX such as venture capital fund Sequoia Capital, the source added. Tether's chief technology officer, Paolo Ardoino, tweeted that it had "no plans to invest in or lend assets to FTX." FTX also got hit by the Bahamas Securities Commission, where the company is based, freezing assets of FTX Digital Markets "and related parties". In a tweet, FTX said it had reached a deal with Tron to establish a special facility that would allow clients to swap some crypto assets from FTX to external wallets. Bankman-Fried told investors that Alameda owes FTX about $10 billion, the Wall Street Journal reported.

☆ U.S. securities regulator says crypto events underscore industry risks
▼ + stars: | 2022-11-09 | by ( Chris Prentice | ) www.reuters.com time to read: +1 min

WASHINGTON, Nov 9 (Reuters) - The turmoil in the cryptocurrency industry of the last few days underscores the risks inherent in the industry as intermediaries handle so many core functions, the head of the top U.S. markets regulator said on Wednesday. Securities and Exchange Commission (SEC) Chair Gary Gensler used the events of the last few days - centered on concerns over the financial healthy of major cryptocurrency exchange FTX - to emphasize the risks of a crypto industry that has been operating outside of traditional financial markets' oversight. "I've been saying this for well over a year now in this job: come in, get registered, come within the securities laws," Gensler said during a Healthy Markets Association event. Gensler noted risks from the "commingling" of key intermediary functions in the cryptocurrency world, in which the same firms serve multiple roles, such as exchanges and market makers. The SEC, which is investigating FTX's handling of client funds, has ratcheted up scrutiny of the crypto industry under Democratic leadership.

A representative for FTX did not immediately respond to requests for comment on the deal or the SEC investigation. FTX and Binance did not disclose the terms of their agreement, and markets face fresh uncertainty over whether it will proceed. REUTERS/Dado Ruvic/Illustration 1 2Prior to the Binance proposed deal, Bankman-Fried approached cryptocurrency exchange OKX on Monday morning about a deal, but the exchange declined to move forward. "It has been a truly a devastating year for the industry," said Ryan Wong, a senior researcher at crypto exchange Huobi. "This could be a major source of risk to crypto markets," Lai wrote.

HONG KONG, Nov 5 (Reuters) - U.S. audit watchdog's onsite inspection of the audit work of New York-listed Chinese companies, which started in Hong Kong in September, has ended, three people with knowledge of the matter said, raising hopes of a resolution of a long-pending dispute. The inspection started in Hong Kong after the two countries signed a pact in August to resolve a dispute that threatened to exclude more than 200 Chinese companies, including tech giant Alibaba Group Holding Ltd (9988.HK), from U.S. exchanges. Reuters reported in August that U.S. regulators had picked a number of U.S.-listed Chinese companies, including e-commerce groups Alibaba and Yum China Holdings Inc for onsite audit inspection. U.S. regulators have for more than a decade demanded access to audit papers of U.S.-listed Chinese companies, but Beijing has been reluctant to let U.S. regulators inspect its accounting firms, citing national security concerns. Reporting by Xie Yu and Julie Zhu in Hong Kong; additional reporting by Chris Prentice in Washington; Editing by Sumeet Chatterjee, Louise Heavens and Jane MerrimanOur Standards: The Thomson Reuters Trust Principles.

Nov 2 (Reuters) - The U.S. Securities and Exchange Commission on Wednesday proposed new rules aimed at better preparing the mutual fund industry for distressed market conditions, including a new pricing mechanism that has drawn opposition from fund managers. The market disruptions of March 2020 reinforced the fact that liquidity can deteriorate rapidly, said the SEC, which adopted the proposal in a 3-2 vote. The proposed rule would require mutual funds, and some exchange-traded funds, to ensure that at least 10% of their net assets are highly liquid. The new requirements would also demand a hard daily closing time for mutual funds, and the use of "swing pricing," which involves adjusting a fund's value in line with trading activity so redeeming investors bear the costs of exiting without diluting remaining investors. Mutual funds managed $4.1 trillion, or 63%, of assets held in 401(k) plans at the end of June, as well as $5.1 trillion, or 43%, of IRA assets, according to the Investment Company Institute.

☆ U.S. SEC obtained $6.4 bln from enforcement in fiscal 2022 -chair
▼ + stars: | 2022-11-02 | by ( Chris Prentice | ) www.reuters.com time to read: +1 min

WASHINGTON, Nov 2 (Reuters) - The U.S. Securities and Exchange Commission (SEC) obtained $6.4 billion from enforcement actions, including $4 billion in penalties, in fiscal 2022, the agency's chair Gary Gensler said on Wednesday. The large number of levies - collected in fines, judgments and other fees from about 700 enforcement actions - would mark a record, underscoring the Wall Street regulator's more aggressive stance against corporate wrongdoing under Democratic leadership. The total levied is higher than the previous year's $3.9 billion the SEC obtained from 697 actions and than 2020's record of $4.7 billion across 715 cases, according to a review of SEC's previous enforcement results. Gensler highlighted the SEC's enforcement activity in the year ended September 30 in prepared remarks at a Practicing Law Institute event. The agency is expected to publish its full enforcement report sometime this month.

The pound touched its highest level since Sept. 13, continuing its rally after Rishi Sunak became Britain's prime minister. U.S. new home sales decreased 10.9% and mortgage rates reached their highest level in 20 years last week, data showed. MSCI's broadest index of Asia-Pacific shares outside Japan (.MIAPJ0000PUS) rallied more than 1%, while Japan's Nikkei (.N225) hit its highest level since Sept. 20. Market participants became cautious after major state-owned banks were spotted selling the dollar on Tuesday to stabilize the market, traders said. U.S. Treasury yields fell, helped by a weaker dollar and Fed hopes.

The U.S. dollar index fell to a five-week low as the pound touched its highest since Sept. 13, continuing its rally after Rishi Sunak became Britain's prime minister. The Dow Jones Industrial Average (.DJI) rose 0.51%, the S&P 500 (.SPX) lost 0.13% and the Nasdaq Composite (.IXIC) dropped 0.97% at 10:37 a.m. EDT (1437 GMT)MSCI's World Stock Index (.MIWO00000PUS) was up 0.36% and touched a five-week high. Europe's Stoxx 600 (.STOXX) also touched a five-week high in choppy trade. Market participants became cautious after major state-owned banks were spotted selling the dollar on Tuesday to stabilize the market, traders said. Elsewhere in commodities, oil prices rose on the weaker dollar and supply concerns.

☆ Yellen taking steps to enhance Treasury market, boost funds resilience
▼ + stars: | 2022-10-24 | by ( David Lawder | ) www.reuters.com time to read: +3 min

Oct 24 (Reuters) - The U.S. Treasury is taking steps to strengthen the resilience of the Treasury debt market and private money market and bond funds, but the U.S. financial system is functioning well despite elevated global volatility, Treasury Secretary Janet Yellen said on Monday. "Treasury is working with financial regulators to advance reforms that improve the Treasury market's ability to absorb shocks and disruptions, rather than to amplify them," Yellen said. MONEY MARKETS, BOND FUNDSHigher market volatility also could expose vulnerabilities in non-bank financial intermediation, Yellen said. She added that Treasury and financial regulators are working to better monitor leverage in private funds and to "develop policies to reduce the first-mover advantage that could lead to investor runs in money market funds and open-end bond funds." Yellen cited stresses in money market funds during the 2008 financial crisis and again in March 2020 as the reason for the Securities and Exchange Commission's new proposed rules to improve resilience and transparency in the $5 trillion money market sector.

☆ U.S., European shares climb on hopes Fed will slow rate hike pace
▼ + stars: | 2022-10-24 | by ( Chris Prentice | Amanda Cooper | ) www.reuters.com time to read: +4 min

WASHINGTON/LONDON (Reuters) - U.S. shares extended last week’s rally and European shares climbed on Monday as signs of a cooling U.S. economy stoked hopes that the Federal Reserve will slow its pace of rate hikes. FILE PHOTO: A Wall Street sign outside the New York Stock Exchange in New York City, New York, U.S., October 2, 2020. Slideshow ( 2 images )Fed officials indicated that the pace of tightening would be at the heart of any policy debate at November’s meeting. Chinese blue chips slid almost 3%, while Hong Kong shares fell 6.4%, their biggest one-day drop since the financial crisis. In commodities, gold prices were under pressure from a firm dollar and the elevated U.S. bond yields.

☆ U.S., European shares rise on hopes Fed will slow rate hike pace
▼ + stars: | 2022-10-24 | by ( Chris Prentice | Amanda Cooper | ) www.reuters.com time to read: +6 min

WASHINGTON/LONDON (Reuters) -U.S. and European shares rose on Monday as signs of a cooling U.S. economy raised hopes that the Federal Reserve will slow its pace of rate hikes. “Investors are getting more confident that inflation is going to come down and that the Fed might be quick to pause. European shares rose on Monday, driven by hopes that the Federal Reserve could slow its pace of interest rate hikes, while investors braced for a busy week of earnings and key interest rate decision from the European Central Bank. Markets are still priced for a rate rise of 75 basis points next month, but have scaled back bets on a matching move in December. Chinese blue chips slid almost 3%, while Hong Kong shares fell 6.4%, their biggest one-day drop since the financial crisis.

☆ Toymaker Mattel agrees to pay $3.5 million to settle SEC charges
▼ + stars: | 2022-10-21 | by ( Chris Prentice | ) www.reuters.com time to read: +2 min

WASHINGTON, Oct 21 (Reuters) - California-based Toymaker Mattel Inc (MAT.O) has agreed to pay $3.5 million to settle U.S. Securities and Exchange Commission (SEC) charges over financial misstatements in 2017, the agency said on Friday. Mattel, which makes Barbie and Fisher-Price toys, incorrectly reported its losses during the third and fourth quarters of 2017 due to tax reporting errors, the SEC said. The issue went uncorrected until November 2019 and the lack of internal control for financial reporting related to the error remained undisclosed. A spokesperson for Mattel, which did not admit or deny the SEC's findings, said the firm is pleased to have the matter behind it. He further failed to maintain auditor independence by advising Mattel's then-chief financial officer about who should be selected for a senior position at the company.

☆ U.S. Commodity Futures Trading Commission levied $2.5 bln in fines last year
▼ + stars: | 2022-10-20 | by ( ) www.reuters.com time to read: 1 min

WASHINGTON, Oct 20 (Reuters) - The U.S. Commodity Futures Trading Commission on Thursday said it had imposed over $2.5 billion in restitution, penalties and ill-gotten gains during the fiscal year ending September 30. The CFTC filed 82 enforcement actions in fiscal 2021, with fraud cases representing the largest number of actions, the agency's data showed. More than 20% of the year's cases related to digital assets, the CFTC said in a statement. The CFTC also brought cases related to market manipulation, including its largest ever benchmark manipulation case against Glencore Agriculture B.V. and Glencore Ltd on charges of manipulation of U.S. and global oil markets. Register now for FREE unlimited access to Reuters.com RegisterReporting by Chris PrenticeOur Standards: The Thomson Reuters Trust Principles.

☆ SEC scrutiny into Wall Street communications shifts to investment funds - sources
▼ + stars: | 2022-10-11 | by ( Chris Prentice | ) www.reuters.com time to read: +4 min

WASHINGTON, Oct 11 (Reuters) - The U.S. Securities and Exchange Commission's scrutiny of how Wall Street handles work-related communications on personal devices and apps such as WhatsApp has expanded beyond broker-dealers to investment funds and advisers, according to four people familiar with the inquiry. A spokesperson for the SEC declined to comment, saying: "We don’t comment on the existence or nonexistence of a possible investigation." The SEC periodically conducts such sweeps to quickly gather information on issues it suspects may be widespread. The institutions did not preserve most of those personal chats, violating federal rules which require broker-dealers and other financial institutions to preserve business communications. Like broker-dealers, investment companies and registered investment advisers are required by the SEC to maintain records of business communications.

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