On March 21, 2022, the U.S. Securities and Exchange Commission (“SEC”), proposed a new climate reporting rule to provide investors with more climate-related data to make informed investments. (SEC). The announcement of this proposal has been met with serious reservations by industry lobbyists and Republican politicians who view the regulation as outside of the SEC’s authority. Id. Notably, General Motors (“GM”) strongly objected to the proposal and sent their CEO to meet with members of the SEC. (SEC). While many organizations have voiced their criticisms of the proposal, whether the SEC will take heed of these objections has yet to be seen…
Read MoreOn May 3, 2022, the Securities and Exchange Commission (“SEC”) announced that it will add twenty positions to the newly renamed Crypto Assets and Cyber Unit within its Division of Enforcement. (Securities and Exchange Commission). This unit’s previous name was simply the “Cyber Unit,” but this new renaming indicates the SEC’s increased focus on crypto assets. Id. Since the SEC created this unit in 2017, it has brought more than 80 enforcement actions related to fraudulent and unregistered crypto asset offerings and has levied more than $2 billion dollars in fees, fines, and penalties…
Read MoreThe GameStop short squeeze and trading halt in early 2021 fueled debates around Wall Street hedge funds and retail trading. One of the areas that drew the most attention was the practice of payment for order flow (“PFOF”), which is a popular form of compensation received by the retail trading brokers such as Robinhood. (Alex Rampell and Scott Kupor, Andreessen Horowitz). Shortly after the trading frenzy, the Securities and Exchange Commission (the “SEC”) released a 44-page report on how the short squeeze and trading halt went down, and raised several red flags on retail broker practices in the report. (Yun Li, CNBC). Since then, the SEC’s chair, Gary Gensler, has directed efforts to research and propose a set of rules aiming to make the US retail securities market more transparent and fair…
Read MoreIn light of recent events and social media exposing continued racial inequalities in the United States, social justice has become a topic at the forefront of discourse. Calls for change and acknowledgment of social justice issues have reached further into the corporate sphere with both the U.S. Securities and Exchange Commission (“SEC”) and shareholders alike demanding more accountability and transparency on the impact corporations have on racial inequalities. (U.S. Securities and Exchange Commission). Recently, Apple shareholders, against the Apple CEO’s recommendation, approved proposals for audits on the company’s civil-rights impact, including the company’s diversity, pay equity, and use of concealment clauses in employment agreements. (Gurman, Bloomberg Law). This recent push is one of many instances calling for similar corporate action and accountability across the board. (Maiden, Corporate Secretary). With recent SEC focus on social justice, new regulations and shareholder pressure, social justice is a topic corporations won’t be able to avoid much longer…
Read MoreIt is no secret the Securities and Exchange Commission (“SEC”) has been ramping up its regulation of cryptocurrencies in the past several years. (Packin, Forbes). However, in the absence of well-fitting regulations, the crypto community has been struggling to understand how securities laws may or may not apply to specific digital assets. Id. According to recent reports, the SEC is looking to expand its regulation even further by targeting certain non-fungible tokens…
Read MoreIn January 2021, GameStop’s stock dropped 16 percent after the company’s holiday sales were 27 percent below expectations. (Matt Perez, Forbes). Demonstrating further evidence of declining business performance, GameStop was scheduled to close 1,000 retail store fronts and lay off 14% of its staff by March 2021 due to the coronavirus pandemic and the trend toward online shopping. (Matt Perez, Forbes; Lauren Gray, Yahoo). Institutional investors capitalized on the company’s poor performance by short selling GameStop’s stock, expecting it to continue to fall. (Juliet Chung, Wall Street Journal). Short sellers are investors who borrow shares of stock from a financial institution to sell on the market with the hope of buying them back later at a lower price. (Adam Hayes, Investopedia). Investors profit from the difference between the price of the shares borrowed and sold and the price of the shares purchased and returned. Id…
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