Website Heading

CALIFORNIA CORPORATE & SECURITIES LAW

BrokerCheck – FINRA’s Dread Permanent Record

Many a school child has received the awful warning to be careful lest some offense be entered on his or her “permanent record”.  As required by statute (15 U.S.C. § 78o-3(i)), the Financial Industry Regulatory Authority, Inc. (aka FINRA) has maintained a sort of permanent record for securities professionals known as “BrokerCheck“.  See FINRA Rule 8312.  Just…

Share on:

NASAA Issues Report On State Enforcement Actions

“Nothing but blue skies From now on” The North American Securities Administrators Association recently released its annual enforcement report.  The report is based on a survey of the 50 state members of NASAA.  The states report data based on either the calendar year or their own fiscal year.  Some highlights of the report are: Nearly 80%…

Share on:

Binary Options And Securities Regulation

Recently, the North American Securities Administrators Association (NASAA) updated and expanded its 2015 advisory warning investors about online binary option schemes.  NASAA offers the following explanation of “binary options”: A binary option is a type of all-or-nothing investment contract, similar to placing a bet. Like the flip of a coin, there are only two possible outcomes: heads…

Share on:

The DBO As Religious Regulator

In December last, the Department of Business Oversight published the 2016 Commissioner’s Report on the Offer or Sale of Securities by Permit under Corporations Code Section 25113.  This report, which is required by California Corporations Code Section 25113(d), provides data on the permits issued by the Commissioner under the Corporate Securities Law of 1968.  Qualification by…

Share on:

NASAA Releases 2015 Enforcement Report

State securities regulators serve an important local enforcement function.  In fact, state securities regulation precedes federal regulation by more than two decades.  The North American Securities Administrators Association is an association of state, provincial and territorial securities regulators from the 50 states, the District of Columbia, the U.S. Virgin Islands, Puerto Rico, Canada, and Mexico.…

Share on:

Is There A State Role For Binary Option Regulation?

The North American State Securities Administrators Association (NASAA) recently warned investors about the risks of investing in binary options.  While NASAA asserts that many binary trading platforms are “unregulated or are completely illegal”, I found it surprising that it didn’t cite any state securities or other laws that might regulate, much less outlaw, binary options…

Share on:

NASAA Mistakes The Principal

I have frequently commented on the fact that many so-called “investor protections” have the unintended consequence of increasing the risk of investor losses.  One example is limitations on resales.  An illiquid security presents greater risk than a liquid security.  Investors understand this and will apply an illiquidity discount to the price of a security.  In this…

Share on:

This May Not Be Rocket Science, But Is NASAA’s Form D Filing Fee Legal?

Earlier this week, the North American Securities Administrators Association (aka NASAA) announced the launch of its Electronic Filing Depository (EFD).  The EFD allows issuers to file Form Ds in Rule 506 offerings online.  A number of states (but not California) issued press releases announcing their participation in NASAA’s EFD.  New Jersey, for example, issued this…

Share on:

Securities Regulator “Surprised and Offended” By SEC’s Regulation A+ Proposal

Section 401 of the JOBS Act directs the Securities and Exchange Commission to adopt rules exempting offerings of up to $50 million of securities annually from the registration requirements of the Securities Act of 1933, as amended.  Last December the SEC proposed rule amendments to Regulation A to implement this mandate.  This is sometimes referred…

Share on:

Does The SEC’s Regulation A Proposal Defy Congress’ Clear Intent?

This week’s announcement by the Securities and Exchange Commission that it is proposing amendments to update and expand Regulation A has attracted quite a bit of attention.  David Lynn writing in Broc’s Blog took special note of the proposed preemption of state blue sky laws.  As expected, additional preemption did not sit well with the…

Share on: