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SEC Applying Current Rules to Past Deeds

Saturday, December 29, 2012

The SEC recently showed that it can and will impose the expanded rules provided by the Dodd-Frank Act to actions that occurred before the statute became effective. The case in question involves a hedge fund manager alleged to have engaged in various fraudulent activities. The SEC imposed a permanent bar against the advisor prohibiting him from associating with a broker-dealer, municipal securities dealer, NSRSO, etc. even though the law prior to Dodd-Frank only permitted a ban from associating with an investment adviser. The SEC stated this action was necessary to protect the public from future harm.

Since the SEC has no issue applying current rules to past deeds, we must all be aware and determine how this view might affect our firms.

To read the full enforcement action, please click here

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Red Oak Compliance Solutions is the global advertising review software of choice in the financial services industry. It is a comprehensive suite of SEC 17A-4 compliant features that are 100% books and records compliant and provides clients with 35% faster approvals and 70% fewer touches or better. We also offer Smart Review(SM), which solves for the storage and maintenance of disclosures, helping firms reduce risk, decrease review times, and increase the speed of distribution of marketing materials. Smart Registration(SM) automates the licensing and registration management process to help reduce regulatory risk and time spent on manual processes. Overall, Red Oak allows firms to minimize risk, reduce costs, and increase compliance review process effectiveness and efficiencies.

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