Federal Regulatory Agencies
News releases, reports, statements and associated documents from federal regulatory agencies ranging from the Securities Exchange Commission to the Commodities Futures Trading Commission
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SEC Announces Agenda, Panelists for Staff Roundtable on Emerging Markets
WASHINGTON, July 3 -- The Securities and Exchange Commission issued the following news release:
The Securities and Exchange Commission announced the agenda and panelists for the July 9, 2020 staff roundtable on investing in emerging markets, including China. Further information, including prior statements and actions in this area, are available here.
The virtual roundtable, announced in May, will be webcast live on SEC.gov starting at 9:30 a.m. ET. Members of the public who wish to provide views on the risks of investing in emerging markets, including China, may submit their views electronically
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WASHINGTON, July 3 -- The Securities and Exchange Commission issued the following news release:
The Securities and Exchange Commission announced the agenda and panelists for the July 9, 2020 staff roundtable on investing in emerging markets, including China. Further information, including prior statements and actions in this area, are available here.
The virtual roundtable, announced in May, will be webcast live on SEC.gov starting at 9:30 a.m. ET. Members of the public who wish to provide views on the risks of investing in emerging markets, including China, may submit their views electronicallyto EmergingMarkets@SEC.gov or use the Internet submission form. Comments may be submitted either in advance of or after the roundtable.
Agenda and Panelist
9:30 Opening Statements by Chairman Clayton and Commissioners
10:00 Panel One: Investments in Emerging Markets by U.S. Retail Investors
Panelists
* Carson Block, Founder and Chief Investment Officer, Muddy Waters Capital LLC
* Ryan LaFond, Deputy Chief Investment Officer, Algert Global
* Roger Robinson, President & CEO, RWR Advisory Group
Moderators
* Peter Driscoll, Director, Office of Compliance Inspections and Examinations
* S.P. Kothari, Chief Economist and Director, Division of Economic and Risk Analysis
11:00 Panel Two: Limitations on Inspection and Enforcement in Emerging Markets; Auditors' Global Oversight of Member Firms in Emerging Markets
Panelists
* William D. Duhnke III, Chairman, Public Company Accounting Oversight Board
* Julie Bell Lindsay, Executive Director, Center for Audit Quality
* Cheryl J. Scarboro, Partner, Simpson Thacher & Bartlett LLP
* Robert Zink, Chief of the Fraud Section, U.S. Department of Justice
Moderators
* Stephanie Avakian, Co-Director, Division of Enforcement
* Sagar Teotia, Chief Accountant
12:00 Lunch Break
1:30 Panel Three: Disclosure and Reporting Considerations with Respect to Investments in Emerging Markets
Panelists
* Paul Gillis, Ph. D., Professor of Practice, Peking University's Guanghua School of Management
* John May, Partner, SEC Services Leader, PwC US
* Amy C. McGarrity, Chief Investment Officer, Public Employees' Retirement Association of Colorado
* Sarah Payne, Partner, Sullivan & Cromwell LLP
* Jill Walker, Senior Vice President, Corporate Financial Services, and Chief Accounting Officer, Starbucks Corporation
Moderators
* Raquel Fox, Director, Office of International Affairs
* William Hinman, Director, Division of Corporation Finance
2:30 Panel Four: Improving Emerging Market Investing for US Retail Investors and Markets
Panelists
* Noriko Honda Chen, Equity Portfolio Manager, Capital Group
* Rodney Comegys, Principal Global Head of Vanguard Equity Index Group
* Sebastien Lieblich, Managing Director and Global Head of Index Solutions, MSCI
* John Tuttle, Vice Chairman and Chief Commercial Officer, NYSE Group Inc.
* John A. Zecca, Executive Vice President and Global Chief Legal and Regulatory Officer, Nasdaq
Moderators
* Dalia Blass, Director, Division of Investment Management
* Christian Sabella, Deputy Director, Division of Trading and Markets
Litigation: SEC Vs. Daniel Dirk Coddington
WASHINGTON, July 3 -- The Securities and Exchange Commission issued the following litigation release (No. 1:13-cv-03363-CMA-KMT; D. Colo. filed December 12, 2013):
On June 29, 2020, the U.S. District Court for the District of Colorado entered final consent judgments against Merlyn Curt Geisler and Marshall D. Gunn, Jr., in connection with their roles in a prime bank scheme orchestrated by Daniel Dirk Coddington. The court also dismissed the SEC's claims against Coddington, who passed away in January 2019, as well as several entities that are now defunct.
The SEC's complaint, filed on December
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WASHINGTON, July 3 -- The Securities and Exchange Commission issued the following litigation release (No. 1:13-cv-03363-CMA-KMT; D. Colo. filed December 12, 2013):
On June 29, 2020, the U.S. District Court for the District of Colorado entered final consent judgments against Merlyn Curt Geisler and Marshall D. Gunn, Jr., in connection with their roles in a prime bank scheme orchestrated by Daniel Dirk Coddington. The court also dismissed the SEC's claims against Coddington, who passed away in January 2019, as well as several entities that are now defunct.
The SEC's complaint, filed on December12, 2013, alleges that Coddington defrauded investors by soliciting investments in Collateralized Mortgage Obligations (CMOs). Specifically, the complaint alleges that Coddington told investors that he would pledge the CMOs as collateral for loans, and then use the loan proceeds in a year-long trading program that would generate profits ranging from 250% to 475%. The complaint further alleges that the trading program did not exist, and that Coddington and others misappropriated the majority of investor money. According to the SEC's complaint, Geisler and Gunn made false and misleading statements about the trading program to solicit investors and received hundreds of thousands of dollars for their efforts.
Geisler and Gunn consented to entry of final judgments without admitting or denying the allegations of the complaint, and agreed to be permanently enjoined from future violations of the antifraud provisions of Section 17(a) of the Securities Act of 1933, and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder and the securities registration provisions of Sections 5(a) and (c) of the Securities Act and the broker-dealer registration provision of Section 15(a) of the Exchange Act. Geisler agreed to pay disgorgement of $653,000, prejudgment interest of $111,604 and a civil penalty of $150,000. Gunn agreed to pay disgorgement of $197,500, prejudgment interest of $33,754 and a civil penalty of $50,000.
The SEC also sought, and the Court granted, dismissal of its claims against Coddington and the entities that he used to perpetrate the fraud, Golden Summit Investors Group Ltd. and Extreme Capital Ltd., and the entities that Geisler and Gunn used to solicit investments, SouthCom Management LLC, Fidelity Asset Services Corp. and Geisco FNF, LLC.
The Commission's civil case is continuing against Jesse W. Erwin, Jr., Seth A. Leyton, Lewis P. Malouf, Stonerock Capital Group LLC, Daniel Scott Coddington, Coddington Family Trust, and Joanna I. Columbia.
The litigation is led by Leslie J. Hughes and Stephen C. McKenna, and supervised by Gregory A. Kasper.
Federal Election Commission Cites Committees for Failure to File 12-Day Pre-Election Financial Reports
WASHINGTON, July 3 -- The Federal Election Commission issued the following news release:
The Federal Election Commission cited three campaign committees for failing to file 12-Day Pre-Election Reports required by the Federal Election Campaign Act of 1971, as amended (the Act), for the Libertarian Party Convention being held on July 6, 2020 in Oregon and primary elections being held on July 7, 2020 in New Jersey.
As of July 2, 2020, the required disclosure report had not been received from:
* Angela Roman for Oregon (OR-5)
* VOTE BIG-VOTE JAMES BALDINI (NJ-5)
* Mark Razzoli for Congress (NJ-12)
The
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WASHINGTON, July 3 -- The Federal Election Commission issued the following news release:
The Federal Election Commission cited three campaign committees for failing to file 12-Day Pre-Election Reports required by the Federal Election Campaign Act of 1971, as amended (the Act), for the Libertarian Party Convention being held on July 6, 2020 in Oregon and primary elections being held on July 7, 2020 in New Jersey.
As of July 2, 2020, the required disclosure report had not been received from:
* Angela Roman for Oregon (OR-5)
* VOTE BIG-VOTE JAMES BALDINI (NJ-5)
* Mark Razzoli for Congress (NJ-12)
TheOregon pre-convention report was due on June 24, 2020, and should have included financial activity for the period April 1, 2020, through June 16, 2020. If sent by certified or registered mail, the report should have been postmarked by June 21, 2020.
The New Jersey pre-primary report was due on June 25, 2020, and should have included financial activity for the period April 1, 2020, through June 17, 2020. If sent by certified or registered mail, the report should have been postmarked by June 22, 2020.
Some individuals and their committees have no obligation to file reports under federal campaign finance law, even though their names may appear on state ballots. If an individual raises or spends $5,000 or less, he or she is not considered a "candidate" subject to reporting under the Act.
The Commission notified committees involved in the Oregon convention of their potential filing requirements on June 17, 2020. Those committees that did not file by the due date were sent notification on June 25, 2020, that their reports had not been received and that their names would be published if they did not respond within four business days.
The Commission notified committees involved in the New Jersey primary elections of their potential filing requirements on June 5, 2020. Those committees that did not file by the due date were sent notification on June 26, 2020, that their reports had not been received and that their names would be published if they did not respond within four business days.
Other political committees that support Senate and House candidates in elections, but are not authorized units of a candidate's campaign, are also required to file quarterly reports, unless they report monthly. Those committee names are not published by the FEC.
Further Commission action against non-filers and late filers is decided on a case-by-case basis. Federal law gives the FEC broad authority to initiate enforcement actions, and the FEC has implemented an Administrative Fine program with provisions for assessing monetary penalties.
FEC: Nonconnected Committee May Deduct a Fee From Earmarked Contributions
WASHINGTON, July 3 -- The Federal Election Commission issued the following advisory opinions document (No. AO 2019-15):
NORPAC, a nonconnected committee that solicits, processes, and forwards contributions to candidate committees may deduct and retain a flat-rate, fixed percentage fee ("convenience fee") from the earmarked contributions it forwards. The convenience fee constitutes a contribution from the original contributor to NORPAC.
Background
NORPAC plans to solicit and collect earmarked contributions via credit and debit cards as well as personal checks, with contributors identifying the
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WASHINGTON, July 3 -- The Federal Election Commission issued the following advisory opinions document (No. AO 2019-15):
NORPAC, a nonconnected committee that solicits, processes, and forwards contributions to candidate committees may deduct and retain a flat-rate, fixed percentage fee ("convenience fee") from the earmarked contributions it forwards. The convenience fee constitutes a contribution from the original contributor to NORPAC.
Background
NORPAC plans to solicit and collect earmarked contributions via credit and debit cards as well as personal checks, with contributors identifying theintended recipient candidate committee. The solicitations will inform contributors of contribution limits and "relevant necessary requirements" for making a contribution. NORPAC will deposit the contributed amount into its own account, then deduct a flat-rate, fixed percentage as a convenience fee to help cover the costs for merchant credit card processing (for credit and debit card contributions) as well as its own administrative and overhead costs. Contributors would be notified of the convenience fee prior to making a contribution. NORPAC will then forward the contribution, less convenience fee, to the recipient candidate committee.
Analysis
NORPAC's proposal to split a contribution between itself and the recipient designated by the contributor consists of two contributions: one to NORPAC and an earmarked contribution to the candidate committee. The Commission has long held that funds paid to a committee for expenses that it incurs to process a contribution as well as those for administrative and overhead are themselves a contribution. Consistent with those precedents, the entirety of the convenience fee constitutes a contribution from the original contributor to NORPAC, and the Commission assumes that NORPAC will provide this information to contributors.
NORPAC must report the full amount of the convenience fee as a contribution on its FEC Form 3X filing as it would any other contribution, itemizing only contributions from individuals aggregating in excess of $200 in a calendar year and all contributions from political committees. As an intermediary, NORPAC will report the total amount of the forwarded contribution as well as the name and mailing address of the original contributor, the date received, the intended recipient as designated by the contributor, the election designated by the contributor (if any), and the occupation and employer of the original contributor. The forwarded contribution will also be reported as a disbursement on Schedule B of its regularly scheduled report, along with the above, as well as a notation that the contribution was forwarded in the form of a check drawn on NORPAC's account.
Finally, NORPAC must file a transmittal report with the recipient committees, including the name and address of contributors whose contributions exceed $50 as well as the occupation and employer of those whose contributions exceed $200. This information must be transmitted simultaneously with the funds.
Date issued: June 18, 2020; Length: 8 pages
Citations
Regulations
11 CFR 102.8
Receipt of contributions
11 CFR 104.1
Scope
11 CFR 104.2
Forms
11 CFR 104.3
Contents of reports
11 CFR 110.6
Earmarked contributions
Resources
* AO 2019-15
* Commission consideration of AO 2019-15
FDIC: FFIEC Joint Statement on Managing the LIBOR Transition
WASHINGTON, July 3 -- The Federal Deposit Insurance Corporation issued the following financial institution letter (No. FIL-68-2020):
Summary:
The FFIEC has issued a Joint Statement on Managing the LIBOR Transition, which highlights the financial, legal, operational, and consumer protection risks that will result from the expected discontinuation of the London Interbank Offered Rate (LIBOR) for institutions with exposure to the LIBOR reference rate. Institutions with LIBOR exposure should have appropriate risk management processes in place to identify and mitigate transition risks.
The Joint
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WASHINGTON, July 3 -- The Federal Deposit Insurance Corporation issued the following financial institution letter (No. FIL-68-2020):
Summary:
The FFIEC has issued a Joint Statement on Managing the LIBOR Transition, which highlights the financial, legal, operational, and consumer protection risks that will result from the expected discontinuation of the London Interbank Offered Rate (LIBOR) for institutions with exposure to the LIBOR reference rate. Institutions with LIBOR exposure should have appropriate risk management processes in place to identify and mitigate transition risks.
The JointStatement on Managing the LIBOR Transition can be found on the Federal Financial Institutions Examination Council's (FFIEC) website.
Statement of Applicability to Institutions with Total Assets under $1 Billion: This Financial Institution Letter (FIL) applies to all FDIC-supervised institutions with exposure to the LIBOR reference rate.
Highlights:
* Institutions should identify and quantify their LIBOR exposures to effectively plan for the transition and mitigate potential financial, legal, operational, and consumer protection risks.
* Institutions with LIBOR exposure should have risk management processes commensurate with the size and complexity of the institution, its activities, and extent of exposure.
* Fallback language in financial contracts will determine how the replacement of a discontinued reference rate will be handled. Institutions with LIBOR-indexed contracts should take steps to include appropriate fallback language that considers a permanent discontinuation of the reference rate to avoid potential legal and safety and soundness risk.
* Transition plans should also address consumer protection risk, including required disclosures to consumers regarding changes in terms and advanced communication for consumers to help them understand how new reference rates would affect their payments, Annual Percentage Rate, and other terms.
* Given the significant effort involved in preparing for the transition, the supervisory focus on evaluating institutions' preparedness for LIBOR's discontinuation will increase during 2020 and 2021, particularly for institutions with significant LIBOR exposure or less-developed transition processes.
Attachment:
FFIEC Statement on Managing the LIBOR Transition (https://www.ffiec.gov/press/PDF/FFIEC%20Statement%20on%20Managing%20the%20LIBOR%20Transition.pdf)
Distribution:
FDIC-Supervised Institutions
Suggested Routing:
Chief Executive Officer
Chief Financial Officer
Chief Credit Officer
FCC Reaches Settlements to Shut Down Boston-Area Pirate Radio Stations
WASHINGTON, July 3 -- The Federal Communications Commission issued the following news release:
The Federal Communications Commission reached settlements with two Boston-area pirate radio operators, Acerome Jean Charles and Gerlens Cesar, following FCC Enforcement Bureau investigations. Through these Consent Decrees, the two operators will pay monetary penalties, admit to violations of section 301 of the Communications Act, agree to 20-year compliance commitments, and agree to dispose of any remaining broadcast equipment in their possession.
Unauthorized radio broadcast stations--also known as
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WASHINGTON, July 3 -- The Federal Communications Commission issued the following news release:
The Federal Communications Commission reached settlements with two Boston-area pirate radio operators, Acerome Jean Charles and Gerlens Cesar, following FCC Enforcement Bureau investigations. Through these Consent Decrees, the two operators will pay monetary penalties, admit to violations of section 301 of the Communications Act, agree to 20-year compliance commitments, and agree to dispose of any remaining broadcast equipment in their possession.
Unauthorized radio broadcast stations--also known aspirate radio stations--operate illegally, undermine the Commission's efforts to manage radio spectrum, and can interfere with licensed communications, including authorized broadcasts and public safety transmissions.
In December, the Commission issued two Notices of Apparent Liability to Acerome Jean Charles and Gerlens Cesar for their apparent unlicensed operations of broadcast radio stations--Radio Concorde and Radio TeleBoston, respectively--in the Boston-area in violation of section 301 of the Communication Act. The Enforcement Bureau negotiated the two Consent Decrees, which provide for a strict compliance plan over a period of 20 years to prevent Jean Charles and Cesar from ever resuming unlicensed broadcasting. Jean Charles has agreed to pay a civil penalty of $4,000, and to pay a further penalty of $75,000 if he violates section 301 of the Act or violates the terms of the Consent Decree; Cesar has agreed to pay a civil penalty of $5,000, and agreed to pay a further penalty of $225,000 if he violates section 301 of the Act or violates the terms of the Consent Decree.
As part of these compliance commitments, both Jean Charles and Cesar have ceased their own pirate radio broadcasting and have agreed not to materially assist anyone else committing such acts. Each has agreed to destroy any broadcast equipment remaining in their possession.
The Adopting Order and Consent Decree with Jean Charles can be found at: https://docs.fcc.gov/public/attachments/FCC-20-87A1.pdf. The Adopting Order and Consent Decree with Cesar can be found at https://docs.fcc.gov/public/attachments/FCC-20-88A1.pdf.
FCC Media Bureau Issues Public Notice on Inflation Adjustment Figures For Cable Operators
WASHINGTON, July 3 -- The Federal Communications Commission's Media Bureau issued the following public notice (MB Docket No. DA 20-68):
This Public Notice is applicable to rate-regulated cable operators that use FCC Forms to justify their cable rates./1
Cable operators adjusting the non-external cost portion of their rates for inflation should follow the instructions provided with the applicable FCC Form. All inflation adjustment figures are based on changes in the Gross National Product Price Index (GNP-PI) published by the United States Department of Commerce, Bureau of Economic Analysis (BEA).
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WASHINGTON, July 3 -- The Federal Communications Commission's Media Bureau issued the following public notice (MB Docket No. DA 20-68):
This Public Notice is applicable to rate-regulated cable operators that use FCC Forms to justify their cable rates./1
Cable operators adjusting the non-external cost portion of their rates for inflation should follow the instructions provided with the applicable FCC Form. All inflation adjustment figures are based on changes in the Gross National Product Price Index (GNP-PI) published by the United States Department of Commerce, Bureau of Economic Analysis (BEA).The Media Bureau obtained the chain-type price indexes from the BEA news release dated June 25, 2020 (BEA 20-29) at Table 1.7.4 (Price Indexes for Gross Domestic Product, Gross National Product, and Net National Product) Line 4 (Gross National Product)./2
Operators filing FCC Form 1240 may make an adjustment based on quarterly figures. The first quarter of 2020 inflation factor for operators using FCC Form 1240 is 1.41%. The adjustment factor of 1.41% is a measure of the annualized change in prices occurring over the period from January 1, 2020 to March 31, 2020. The inflation adjustment factor is calculated by dividing the GNP-PI for the first quarter of 2020 (113.343) by the GNP-PI for the fourth quarter of 2019 (112.946). The result of this calculation is converted from a quarterly change measurement factor to an annual change measurement factor by raising it to the fourth power.
Operators calculating the Inflation Factor for a True-Up Period which includes some portion of the first quarter of 2020 should enter the inflation factor on the appropriate lines of Worksheet 1 of FCC Form 1240 as "0.0141." Operators using this factor for calculating the Projected Period Inflation Segment of FCC Form 1240 should enter this number on Line C3 (January 1996 version), or Line C5 (July 1996 version) as "1.0141".
To date, the Commission has released ninety-five quarterly inflation factors for use with FCC Form 1240. The following table lists these factors beginning in 2014.
To view the table click here (https://docs.fcc.gov/public/attachments/DA-20-686A1.pdf).
The Commission releases a new quarterly inflation factor for operators using FCC Form 1240 four times each year. The inflation factor for a given quarter is usually released between three and four months after the end of the quarter, depending on the schedule of the Department of Commerce. The release of a new factor is posted on the Commission's Internet site at: https://www.fcc.gov/general/inflation-updates-forms-1210-and-1240.
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1/ Pursuant to 47 CFR Sec. 76.922(d)(2) and Sec. 76.922(e)(2) of the Commission's rules, cable operators may adjust the non-external cost portion of their rates for inflation.
2/ Table 1.7.4 can be found at this link: https://apps.bea.gov/iTable/iTable.cfm?reqid=19&step=2#reqid=19&step=2&isuri=1&1921=survey
