Securities Exchange Act | Securities Litigation, Investigations and Enforcement
The SEC’s Office of Compliance Inspections and Examinations Warns Investment Advisers: “Don’t Mislead or We Will Proceed!”
On September 14, 2017, the SEC’s Office of Compliance Inspections and Examinations (“OCIE”) issued a Risk Alert in which it highlighted a number of compliance issues it had identified relating to the so-called Advertising Rule (Rule 206(4)-1 of the Investment Advisers Act of 1940 (“Advisers Act”)).
The Advertising Rule imposes four specific provisions that prohibit investment advisers from making certain references, representations, and statements in advertisements that are deemed to be fraudulent, deceptive, or manipulative (Advisers Act Rule 206(4)-1(a)(1)-(a)(4)). It further prohibits advertisements that contain untrue statements of material fact, or are otherwise false or misleading (Advisers Act Rule 206(4)-1(a)(5)).
Specifically, the Advertising Rule prohibits advertising that refers to any testimonial regarding an adviser’s advice, analysis, report, or service; advertising that refers to past recommendations that were or would have been profitable to any person, with limited exceptions; advertising, representing, through graphs, charts, formulas, or other devices, that a decision to buy or sell a security can be made on the sole basis of that representation; and advertising containing any statements that any report, analysis, or service will be provided free of charge, unless it will be furnished free and without any obligation. The Advertising Rule also expressly prohibits an adviser, directly or indirectly, from publishing, circulating, or distributing any advertisement that contains any untrue statement of a material fact, or which is otherwise false or misleading. READ MORE →
Posted in Financial Institutions, Securities Exchange Act	Tagged Compliance, investment advisers, Investment Advisers Act of 1940, Investment Management, Securities and Exchange Commission	
Posted in Securities Exchange Act	Tagged Exchange Act Section 10(b), FDA, Food and Drug Administration, issuer, misrepresentation, Omnicare, Omnicare Inc. v. Laborers District Council Construction Industry Pension Fund, opinion statements, Second Circuit, Securities Act, Securities Act of 1933, Securities Exchange Act of 1934	
Robert VarianPosted on December 15, 2015
On December 1, 2015, the Supreme Court heard argument in Merrill Lynch, Pierce, Fenner & Smith Inc. v. Manning. In that case, the Court will resolve the split in the Circuits as to whether Section 27 of the Securities Exchange Act of 1934 (“the ’34 Act”) provides federal jurisdiction over claims that are asserted under state law but are based on violations of regulations adopted under the ’34 Act.
Posted in SEC, Securities Exchange Act	Tagged Merrill Lynch v. Manning, Regulation SHO, SCOTUS, Section 27, Securities Exchange Act 1934, State courts	