Thursday, March 4, 2021
Corporate Compliance Insights
  • Home
  • About
    • About CCI
    • Writing for CCI
    • NEW: CCI Press – Book Publishing
    • Advertise With Us
  • Articles
    • See All Articles
    • NEW: COVID-Related
    • Compliance
    • Ethics
    • Risk
    • FCPA
    • Governance
    • Fraud
    • Internal Audit
    • HR Compliance
    • Cybersecurity
    • Data Privacy
    • Financial Services
    • Leadership and Career
  • Vendor News
  • Jobs
    • Compliance & Risk
    • Information Security
  • Events
    • Webinars & Events
    • Submit an Event
  • Downloads
    • eBooks
    • Whitepapers
  • Podcasts
  • Videos
  • Subscribe
No Result
View All Result
  • Home
  • About
    • About CCI
    • Writing for CCI
    • NEW: CCI Press – Book Publishing
    • Advertise With Us
  • Articles
    • See All Articles
    • NEW: COVID-Related
    • Compliance
    • Ethics
    • Risk
    • FCPA
    • Governance
    • Fraud
    • Internal Audit
    • HR Compliance
    • Cybersecurity
    • Data Privacy
    • Financial Services
    • Leadership and Career
  • Vendor News
  • Jobs
    • Compliance & Risk
    • Information Security
  • Events
    • Webinars & Events
    • Submit an Event
  • Downloads
    • eBooks
    • Whitepapers
  • Podcasts
  • Videos
  • Subscribe
No Result
View All Result
Corporate Compliance Insights
Home Featured

Key Topics of Interest to the SEC

by Michael Manley
April 20, 2018
in Featured, Financial Services
two businessmen analyzing a financial report

Guidance from Director Dalia Blass

Director Dalia Blass of the SEC’s Division of Investment Management (the “Division”) recently delivered the keynote address for the ICI 2018 Mutual Funds and Investment Management Conference.1 Director Blass discussed four main topics: (1) the role of data in the SEC’s work, (2) the role of fund directors, (3) aspects of exchange-traded funds (ETFs) and (4) considerations related to index providers.

Data and the SEC

In her remarks, Director Blass discussed the importance of data in regulating over 20,000 registered funds and advisers. In that regard, the SEC uses an internal tool known as MAGIC, or the Monitoring and Analytics GUI for Investment Companies. MAGIC combines “performance, flow, holdings and other information,” which, among other things, allows the SEC to compare a fund’s portfolio to its strategy and to evaluate whether its holdings align with its investment restrictions.2 In particular, MAGIC allows the SEC to identify which funds may have exposure to certain asset classes, such as cryptocurrencies. In her remarks, Director Blass indicated that MAGIC is dynamic, allowing the SEC to incorporate new data sets, such as information collected from Form N-PORT, and adding machine learning capabilities.

Fund Board Outreach

Director Blass next discussed the SEC’s “Board Outreach Initiative” and indicated that, over the last few months, Division staff have met with funds boards, independent directors, counsel to independent directors and funds and independent auditors. She articulated certain findings from the initiative, including items of interest to shareholders, such as “fees and expenses, investment performance, the rigor of the investment process and the quality of services provided to the fund.”3 Interestingly, directors have stressed the importance of respecting the line between oversight and management; in other words, “there is a difference between overseeing the work of experts and being asked to serve as experts.”4 For these reasons, one priority of the Commission staff is to update valuation guidance to reflect the evolution of the markets and accounting standards.

ETFs

On the topic of ETFs, Director Blass highlighted that the ETF market exceeds $3.5 trillion, pursuant to more than 300 exemptive orders. On the hand, Director Blass cited the flexibility offered by the SEC’s ability to issue exemptive relief, but contrasted this flexibility with the expense of obtaining such relief and uncertainty surrounding the guidance provided by these orders. In that regard, she stated that the Division is working on an ETF rule to deliver to the Commission. Director Blass further discussed the broad categories of investment vehicles captured by the common use of the term “ETF.” She expressed concern that investors lack understanding of the “risks, investment strategies and investor protections among ETFs, commodity pools and exchange-traded notes.”5

Index Providers

Finally, Director Blass asked whether the time had come to revisit the status of certain index providers as investment advisers and particularly emphasized providers maintaining an index for only a single fund. She acknowledged the history of many indexes relying on the publisher’s exclusion from the definition of “investment adviser,” but Director Blass cautioned against the assumption that a provider’s status is “based simply on its characterization as an index provider.”6 To be clear, Director Blass stated: “We are not making that assumption.”7

These remarks articulate certain Division priorities. Market participants and practitioners would be well served to review their substantive analysis related to these priorities, and, for market participants, to consider whether their compliance policies and procedures would be impacted.

________________________
[1] Keynote Address, ICI 2018 Mutual Funds and Investment Management Conference, March 19, 2018.
[2] Id.
[3] Id.
[4] Id.
[5] Id.
[6] Id.
[7] Id.


Previous Post

Financial Industry Views Regulation as Positive, But Insufficient to Prevent the Next Crash

Next Post

What is Cryptocurrency and Who is Going to Regulate It?

Michael Manley

Michael ManleyMichael Manley is a partner at Venable and previously served as general counsel, Chief Compliance Officer and Secretary for CĪON Investment Management, LLC, a registered investment adviser and CĪON Investment Corporation, an externally managed, non-traded, business development company. Mr. Manley was responsible for developing and implementing comprehensive compliance programs, including establishing corporate charters, corporate governance policies and various policies and procedures regarding code of ethics, insider trading, custody and SEC disclosure. He also negotiated agreements with swap counterparties, custodians, consultants, insurers and other fund providers. Additionally, Mr. Manley served as general counsel, chief compliance officer and secretary for both CĪON entities. Mr. Manley previously worked at investment adviser Plainfield Asset Management and, as co-general counsel and chief compliance officer, managed the day-to-day legal and compliance affairs for Plainfield Direct, a business development company managed by Plainfield Asset Management.

Related Posts

The facade of the SEC in Washington, D.C.

Prepare Now to Comply with SEC’s Updated MD&A and Related Financial Disclosure Requirements

March 3, 2021
Illustration representing a facial recognition technology scan of a face.

Facial Recognition Technology in the Workplace: Employers Use It, Workers Hate It, Regulation Is Coming for It

March 3, 2021
A director contemplates information at her desk.

Key Concerns for Directors in 2021: Recovery from COVID-19 Is Top Priority

March 2, 2021
woman looking at horizon from mountain top

What’s on the Horizon for Anti-Corruption Enforcement?

February 25, 2021
Next Post
bitcoin symbol on smartphone

What is Cryptocurrency and Who is Going to Regulate It?

OneTrust offers download to demonstrate privacy management leadership
Access realtime data
Addressing systemic racism in the workplace SAI Global
Top 10 Risk and Compliance Trends

Special Coverage

Special COVID page graphic

Jump to a Topic:

anti-corruption anti-money laundering/AML Artificial Intelligence/A.I. automation banks board of directors board risk oversight bribery CCPA/California Consumer Privacy Act Cloud Compliance communications management Coronavirus/COVID-19 corporate culture crisis management cyber crime cyber risk data analytics data breach data governance decision-making diversity DOJ due diligence ESG fcpa enforcement actions financial crime GDPR GRC HIPAA information security KYC/know your customer machine learning monitoring ransomware regtech reputation risk risk assessment SEC social media risk supply chain technology third party risk management tone at the top training whistleblowing
No Result
View All Result

Privacy Policy

Follow Us

  • Facebook
  • Twitter
  • LinkedIn
  • RSS Feed

Category

  • CCI Press
  • Compliance
  • Compliance Podcasts
  • Cybersecurity
  • Data Privacy
  • eBooks
  • Ethics
  • FCPA
  • Featured
  • Financial Services
  • Fraud
  • Governance
  • GRC Vendor News
  • HR Compliance
  • Internal Audit
  • Leadership and Career
  • Opinion
  • Resource Library
  • Risk
  • Uncategorized
  • Videos
  • Webinars
  • Whitepapers

© 2019 Corporate Compliance Insights

No Result
View All Result
  • Home
  • About
  • Articles
  • Vendor News
  • Podcasts
  • Videos
  • Whitepapers
  • eBooks
  • Events
  • Jobs
  • Subscribe

© 2019 Corporate Compliance Insights