On 3 October, AFM issued rules on investment institutions risks of AML. Concern of managers/administrators of investment institutions facing AML/CTF risk. AFM asked administrators what they do to prevent becoming involved in laundering. Concluded that compliance with laws needed to be improved for a number of areas. Monitoring Prevention AFM and DNB supervises AML, Financing…
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U.S. DoJ Pay-to-Play NYS Pension
On 29 September, SDNY charged dealer with NY public pension fund bribery. Deborah Kelley, was ex-MD of institutional fixed income sales at a broker dealer. Bribery Kelley participated in scheme involving the NY State Common Retirement Fund. Bribed official with control over investment of $50bn State pension fund assets. Directing business to her firm,…
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E. U. ESMA Updates Market Abuse FAQs
On 29 September, ESMA issued updated FAQs on disclosure of inside information - Art 17(4). Cover delayed inside information that has lost the feature of price sensitivity under MAR. Clarifies where information ceases to be price sensitive it is no longer insider information. Issuer neither obliged to publicly disclose information nor inform the competent…
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U.S. SEC Fine Brokers Churning
On 28 September, SEC charged dealers with unsuitable recommendations. Exam of Alexander Capital, detected potential misconduct among certain brokers. Complaint vs. William Gennity and Rocco Roveccio, order against Laurence Torres. Defendants recommendations caused loss to customers, commissions to brokers. Defendants churned customer accounts, unauthorized trades, and hid information. Customer losses of $683k while defendants received approximately…
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U.S. FINRA Fines Morgan Stanley UITs
FINRA settles with Morgan Stanley for $13mn re UITs. Morgan Stanley charged re failure to supervise sale of unit investment trusts UIT. Suitability Concerns UIT is investment company offering portfolio units terminating on a specific date. Impose deferred sales charge and a creation and development fee, can be 3.95%. A representative who repeatedly recommends customer…
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U.S. OFAC Fine HK Jewel Export
On 26 September, OFAC fined exporter for jewelry sales to HK person. Settlement agreement of $344,800 with Richemont North America, DBA. Cartier. Firm violated rules when exporting jewelry shipments to Shuen Wai Holding HK. Shuen Wai is an entity on OFAC list of designated nationals and blocked persons. OFAC determined Richemont did not voluntarily self-disclose…
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