On July 26, 2021, a senior U.S. Securities and Exchange Commission official, Allison Lee, advised that Chinese companies listed on U.S. stock exchanges must disclose the potential risks associated with the Chinese government interfering in their businesses, as part of their normal reporting requirements. The genesis of SEC’s comment is believed to be the recent…

On May 19, 2021, the Securities and Exchange Commission (“SEC”) charged a broker-dealer, BTIG, LLC (“BTIG”), with repeatedly violating the (i) order-marking and (ii) locate provisions of Regulation SHO, in connection with more than 90 sale orders from a single hedge fund customer. Regulation SHO regulates short sales of securities and is aimed, in large…

Environmental, social and governance (ESG) factors have become a key discussion point in the asset  management industry, with many managers incorporating ESG considerations into the investment processes.  In 2019, ESG investment funds increased by $70 billion while traditional equity funds saw an outflow of $200 billion.  ESG investments continue to increase in comparison to “traditional” equity…

As the market for cryptocurrency continues to mature, institutional investors and asset management firms are increasingly embracing the asset class. Companies that are considering entering the cryptocurrency space should be aware of an important business license for virtual currency activities issued by the New York State Department of Financial Service, (the “DFS”), commonly referred to…

On April 12, 2021, the Securities and Exchange Commission (SEC) released a new interpretation, without notice or a comment period, which calls into question whether warrants issued by special purpose acquisition companies (SPACs) could continue to be considered equity instrument.  The SEC’s new interpretation reveals a position that is contrary to widespread practice of classifying…

The Internal Revenue Service (IRS) will publish in April 14, 2021’s Federal Register a notice of proposed rulemaking for the opportunity zones (OZ) incentive that provides flexibility in the 24-month extension of the working capital safe harbor in the case of federally declared disaster areas. The proposed rule that would also provide requirements that certain…

The New York State Legislature passed a statutory solution to reduce the risks associated with the transition away from USD LIBOR.  New York Senate Bill 297B/Assembly Bill 164B (the “NY Bill”), proposed by the Alternative Reference Rates Committee (“ARRC”) and sponsored by New York Senator Kevin Thomas, was designed to solve transition issues for legacy…

What Can We Expect from the Regulators? Robin Powers, Partner, Rimon, P.C. Archegos Capital Management’s collapse last week, and the resulting losses for several global banks, has and will impact financial markets for the foreseeable future. Regulatory efforts will likely focus on the ever-expanding shadow banking sector and shed light on its transparency (or lack thereof) and…

In 2012, the Jumpstart Our Business Startups (“JOBS”) Act introduced Regulation Crowdfunding (“Reg CF”) to the regulatory framework governing exempt offerings, enabling eligible companies to offer and sell securities through crowdfunding.  The JOBS Act was created to ease securities regulations and to encourage the private funding of U.S. small businesses by reducing costs associated with…

The SEC’s Office of Compliance Inspections and Examinations recently published a risk alert related to investment advisers managing Digital Assets for their clients, either directly or indirectly through pooled investment vehicles.  The risk alert makes it clear that digital assets create a number of unique compliance challenges that firms should consider. Based upon risks identified…