Law and regulation

A bond investor’s suspicions triggered a municipal bond trustee’s firing of a vice president but the question remains: what happened to more than $2 million?

In muni underwriting understanding who is obligated to make required disclosures and the content and timing of required disclosures are critically important.

Rep. Nydia Velázquez wants to extend protections under the Investment Company Act of 1940 to Puerto Rico, saying their absence caused Puerto Ricans to suffer losses when they invested in mutual funds heavily stocked with the financially struggling commonwealth’s bonds.

Dealers acting as principals would have to disclose markups and markdowns in transactions with retail customers under rule changes proposed by the Municipal Securities Rulemaking Board.

The Securities and Exchange Commission has proposed to update its rules for administrative proceedings to provide more flexibility to parties and improve the availability of documents to the public.

The Securities and Exchange Commission’s five members unanimously agreed on Tuesday to propose a rule and amendments that would require open-end mutual funds and exchange traded funds to take steps to manage liquidity risks so they could handle redemptions during periods of financial stress.

The National Association of Bond Lawyers is calling for increased education of issuers on continuing disclosure in the wake of lessons learned from the Municipalities Continuing Disclosure Cooperation initiative.

The Municipal Securities Rulemaking Board’s pending fee changes will be unfair and excessively burdensome, dealer and advisor groups told the Securities and Exchange Commission.

Former Internal Revenue Service director Mark Scott is urging the IRS to revoke a private-letter ruling that was favorable for a total return swap, arguing that TRS’ are “[arbitrage scheme[s]” that have “resulted in hundreds of millions of dollars of illegal tax benefits being stolen.”

While the issue price rules proposed by the Treasury Department and Internal Revenue Service in June are a “significant improvement” over those proposed in 2013, the alternative method for determining issue price under the recent proposal is currently “not workable,” the Securities Industry and Financial Markets Association wrote.

The Obama administration is emphasizing the urgency of giving Puerto Rico the right to use a bankruptcy process for its debts.

The National Federation of Municipal Analysts has released the final version of its set of best practices for state government general obligation bond disclosure, the first part of an ongoing update to a set of recommended best practices from 2001.

The Municipal Securities Rulemaking Board has shelved its controversial proposal to ease independence standards to obtain a public investor on its board and will instead establish an investor advisory group.

The Securities and Exchange Commission adopted amendments to its money market fund rule that would remove credit ratings references funds use to comply with the rule -- an action many market participants applauded but others said could pose risks..

Securities and Exchange Commission Chair Mary Jo White said she will work to make regulatory and other changes to support shortening the settlement cycle for several types of secondary market transactions from three days after a trade date to two days by 2017.

Securities and Exchange Commission top cop Andrew Ceresney and a Justice Department official warned legislators on Wednesday that a bill to update the Electronic Communication Privacy Act of 1986 could hurt their enforcement programs.

Dealer groups oppose a Municipal Securities Rulemaking Board proposal to provide academics with muni trade and pricing data with anonymous dealer identifiers while researchers contend the new data will add to market transparency.

Four broker-dealer firms have been ordered by the Financial Industry Regulatory Authority to pay a total of $67,500 for municipal trade reporting and related violations.

Dealer, issuer and investment company groups are urging the Securities and Exchange Commission to disapprove a Municipal Securities Rulemaking Board rule that would impose core duties on municipal advisors, warning it is overly burdensome and anti-competitive.

The American College of Bond Counsel has elected officers and directors for the coming year.