Jack Casey

Securities and Exchange Commission enforcement officials are expected to focus on disclosure and pricing abuses as well as increase their oversight of municipal advisors during the coming year, according to regulators and market participants.

In the regulatory and legislative arenas next year, dealers will have to grapple with how to set up compliance programs for markup disclosure rules while municipal advisors try to adjust to the many rules adopted in 2016 and issuers work to improve disclosure to stave off legislation.

Ross Sinclaire & Associates has agreed to pay $250,000 and to disgorge ill-gotten gains to settle muni rules violations with the Financial Industry Regulatory Authority after it improperly acted as a financial advisor and underwriter on the same muni issuances. The Cincinnati-based firm also failed to disclose material facts in offering documents and was late in filing underwriting disclosures with regulators, FINRA said.

SEC sues, U.S. Attorney indicts former official of New York State Common Retirement Fund and two brokers over pay-to-play scheme.

Congress should further debate the effectiveness of Securities and Exchange Commission and Municipal Securities Rulemaking Board rules governing the failure to comply with municipal securities disclosure requirements, a congressional task force on Puerto Rico recommended.

The Municipal Securities Rulemaking Board’s rule changes to prevent municipal advisors from engaging in pay-to-play practices are constitutional and comply with federal statutes, contrary to the claims of three Republican groups, the MSRB told a federal appeals court on Monday

Market groups and firms are asking the Municipal Securities Rulemaking Board to rethink proposed rule changes related to complaints, saying they should be adapted to better fit the differences in the relationships that municipal advisors have with clients and dealers have customers.

The Securities and Exchange Commission will not bring any more settlements under its Municipalities Continuing Disclosure Cooperation initiative and will instead focus on those underwriters and issuers that did not voluntarily disclose violations under the MCDC.

While Puerto Rico is at a crossroads, it must file for restructuring as soon as possible and work with the federal government to help resolve the commonwealth’s fiscal crisis, said outgoing Puerto Rico Gov. Alejandro García Padilla.

Former Miami budget director Michael Boudreaux plans to ask a federal district court by Jan. 3 to vacate a jury’s verdict that he was guilty of securities fraud, according to his lawyer.

A bill introduced by Rep. Gwen Moore, D-Wis., that would shift municipal disclosure responsibilities to issuers and borrowers from underwriters could drive some localities out of the market, issuer officials warned Moore’s chief of staff on Thursday.

Sen. Marco Rubio introduced a bill on Tuesday that he said would raise wages for workers in Puerto Rico and make hiring new employees more attractive.

Former Miami budget director Michael Boudreaux will face a much lighter penalty for securities fraud than the Securities and Exchange Commission sought, after a federal court judge found that the commission overreached in its requests to have Boudreaux enjoined and fined $450,000.

The Financial Industry Regulatory Authority has ordered UBS to pay two Puerto Rican residents $18.4 million in damages, interest, and other fees over the residents’ investments in closed-end mutual funds concentrated in Puerto Rico bonds.

While Congress and the Treasury Department have put a framework in place for Puerto Rico’s recovery, the key challenge ahead is whether they will be able to work together on health care and tax initiatives to spur economic growth in the commonwealth, said Kent Hiteshew, director of the Treasury’s Office of State and Local Finance.

The Securities Industry and Financial Markets Association wants bank regulators to avoid adopting harsh international capital standards for trading that could have a chilling effect on the municipal market and hurt liquidity.

The MSRB issued interpretive guidance on how its rules apply to accounts that are fully managed by a registered investment advisor that is also a sophisticated municipal market professional.

The SEC, in a court filing on Tuesday, said former Miami budget director Michael Boudreaux's arguments against penalties the SEC wants to impose on him for securities fraud show a lack of responsibility and respect for the jury verdict that found him guilty.

The Financial Industry Regulatory Authority found that Merrill Lynch failed to properly supervise customers’ investments in Puerto Rico bonds and closed-end funds.

The Municipal Securities Rulemaking Board has announced that its dealer markup rule will take effect on May 14, 2018.