Law and regulation

President Barack Obama on Wednesday nominated Hester Peirce to finish Daniel Gallagher’s term until June 5, 2016, and Lisa Fairfax to replace Luis Aguilar for a five-year term to the Securities and Exchange Commission.

A proposed House bill to treat investment grade and actively traded municipal securities as high quality liquid assets received support from members of a House Financial Services Committee panel as well as banking experts during a hearing on Wednesday.

The Treasury Department's Antonio Weiss and Puerto Rico Gov. Alejandro Garcia Padilla will testify on Thursday before a Senate Committee on the territory's economy, debt and options that should be considered by Congress.

The Municipal Securities Rulemaking Board is extending the date for comments on its recently proposed markup disclosure rule while an industry group wants the board to delay the implementation deadline for its best execution rule.

The Municipal Securities Rulemaking Board’s proposed changes to extend its gift rule to municipal advisors “remain unclear in crucial areas” and “do not go far enough to prevent abuses” by both MAs and broker-dealers, the National Association of Municipal Advisors said.

Landolt Securities, Inc. has been ordered by the Financial Industry Regulatory Authority to pay $20,000 for violating municipal trade reporting, books and records, and supervisory rules.

Christopher Brogdon, who was at the center of more than a dozen problematic healthcare municipal bond deals for which at least $2 million was unaccounted for, will resign from the board of healthcare firm AdCare.

The Municipal Securities Rulemaking Board plans at its quarterly meeting next week to discuss its proposal to require dealers to disclose on retail customer confirmations the markups and markdowns on principal transactions.

Securities and Exchange Commission officials updated National Association of Municipal Advisors members here on the status of the commission’s municipal advisor examinations and fielded individual questions about continuing compliance with the program.

The Financial Industry Regulatory Authority ordered San Juan-based Santander Securities on Tuesday to pay $6.4 million for supervisory failures related to Puerto Rican municipal bonds.

Middle-market securities dealers need to redouble efforts to make their voices heard as regulators prepare to tighten the reins on the muni market, Bond Dealers of America members said.

Rebecca Olsen, deputy director of the Securities and Exchange Commission’s office of municipal securities, has concerns about municipal advisor misconceptions she has heard about who can advise in the municipal market and who can be considered an independent registered municipal advisor.

The Securities and Exchange Commission’s Office of Municipal Securities is weighing whether to provide legal interpretive guidance to help municipal advisors determine if they are acting as an adviser or broker-dealer when working with an issuer on a bank loan.

Resident Commissioner Pedro Pierluisi, D-P.R., has introduced a bill that would authorize the Treasury Department to guarantee future bonds issued by Puerto Rico and its authorities if it finds they have meaningfully improved the management of their finances.

Nat Singer recently compared chairing the Municipal Securities Rulemaking Board to running “a relay race.” He said his leg of the race is to work with the board to move forward with rules such as those on municipal advisor core conduct and dealer disclosure of markups on principal trades and then hand the work off to the next chairman and board.

At least three major Wall Street firms have not settled with the Securities and Exchange Commission under its Municipalities Continuing Disclosure Cooperation initiative, noted some lawyers who were involved with a National Association of Bond Lawyers survey on the impact of MCDC.

The Municipal Securities Rulemaking Board is asking for industry feedback on a proposal to make board members more effective by changing the length of their terms to four years instead of three.

Utah Treasurer Richard Ellis has been tapped to serve a second three-year term as a public member of the Municipal Securities Rulemaking Board.

The Securities and Exchange Commission ordered 22 municipal securities underwriting firms to pay $4.12 million in civil penalties in the second round of what some lawyers said on Wednesday will be three total rounds of underwriter settlements under the commission’s Municipalities Continuing Disclosure Cooperation initiative.

UBS Financial Services of Puerto Rico agreed to pay $34 million to settle charges by the Financial Industry Regulatory Authority and Securities and Exchange Commission that it failed to supervise the suitability of transactions in Puerto Rican closed-end fund shares, as well as a former broker who had customers invest in those CEFs using money borrowed from an affiliated bank.