Regulatory practice publications

The SEC adopts final rule on hedge fund filing - October 2011 The Securities and Exchange Commission (SEC) unanimously approved a final rule requiring registered advisers to private funds to report detailed information on new Form PF. The information will be used by the Financial Stability Oversight Council to gain insight into the activities of advisers, enhance its risk monitoring of the financial markets, and assess systemic risk.
FDIC Board to Consider Volcker Rule Proposal on October 11th - October 2011 The FDIC's Board will consider Proposed Rulemaking on the Volcker Rule at its next meeting on Tuesday, October 11, 2011 at 10:00 AM. The FDIC is the first Agency (the others are the Federal Reserve Board, OCC, SEC and CFTC) to consider a Volcker Rule proposal. Industry sources indicate a 60-day comment period is likely.
	Integrating technology into your compliance program to improve effectiveness and efficiency - October 2011 This paper discusses how technology can help financial services firms implement robust compliance programs which are increasingly important in the wake of the Dodd-Frank Act and other regulatory changes.
	Avoiding the Headlines: How Financial Services Firms Can Implement Programs to Prevent Insider Trading Insider trading has become a top priority of prosecutors, with increased cooperation among civil and criminal regulators, both in the United States and abroad.
	The lull before the storm: AIFMD News Edition 8, Spring 2011 In this edition of AIFMD News we discuss the latest developments and consider what clients should be doing to prepare for the Directive's implementation.
	Financial reform, what's next? A US and global perspective examining the opportunities and challenges ahead PwC and Georgetown University's McDonough School of Business convened government decision makers, business executives, leading academics and students at Georgetown University for a two day conference to explore the impact of the new law and the next phase of regulation in a ground-breaking event, "Financial Reform: What's Next?" This conference highlights summarizes the dialogue and some of the views expressed.

Taking stock – AIFMD News Edition 7
The purpose of this briefing is to take stock, review the final terms of the directive, consider the next steps both in the legislative process and what the industry’s response should be.

The Dodd-Frank Wall Street Reform and Protection Act: Implications for fair lending compliance
Under Dodd-Frank, we expect regulatory scrutiny of fair lending to be raised to a whole new level. Even prior to Dodd-Frank, a heightended political and regulatory focus emerged on fair lending. How should banks respond? Institutions should consider assessing their existing fair lending compliance (and general consumer compliance) risk management programs against leading standards from across the federal bank regulatory agencies, identify areas of enhancement and work to ensure that enhancements are in place in a timely manner.

The Dodd-Frank Wall Street Reform and Consumer Protection Act: Mortgage Industry Considerations
When President Obama signed the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 ("Dodd-Frank" or the "Act"), July 21, 2010. the largest set of financial regulatory reforms since the Great Depression became law. The sweeping legislation will significantly impact every aspect of the financial services sector — and the mortgage industry is no exception.

Pay to play
“Pay-to-play” is the practice of making campaign contributions and related payments to elected officials in an attempt to influence the awarding of lucrative contracts for the management of public pension plan assets and similar government investment accounts.

Private fund advisers: Integrating testing into a risk-focused compliance program
The financial services industry that has emerged from the recent market turmoil is one that has stricter standards, greater regulatory scrutiny, and higher client expectations for alternative asset management firms. As part of the Dodd-Frank Wall Street Reform and Consumer Protection Act many hedge fund and private equity fund advisers (private fund advisers) will be required to register with the Securities Exchange Commission (SEC).

PwC's Financial Services Regulatory Practice: How we can help private equity advisors
Financial regulatory reforms passed in July 2010 will require most private equity (PE) fund advisors to register with the US Securities and Exchange Commission (SEC). After being exempt from registration for more than 70 years, PE advisors will be subject to the full scope of the Investment Advisers Act of 1940, increased disclosure and reporting requirements, and periodic inspections by the SEC. Importantly, because Congress left critical details for rule making to regulatory agencies, this adjustment will be a multiyear process.

A Closer Look: The Dodd-Frank Wall Street Reform and Consumer Protection Act - August 2010
The Dodd-Frank Wall Street Reform and Consumer Protection Act is one of the most complex pieces of legislation ever written. Financial service firms and other impacted organizations are just beginning to understand the Act's many facets and its full impact will not be known until all of the studies have been conducted, reports written, and regulations issued. To assist our clients, PwC is taking A Closer Look at how the Act will impact several distinct market segments.

Navigating risk in the high-frequency trading environment
This report offers our firm's point of view on the compliance challenges of high-frequency trading and a framework for addressing the unique risk and control challenges that high-frequency trading strategies present.

Financial regulatory reform — The new regulatory architecture — Will it be a global blueprint?
On June 30th, the U.S. House of Representatives passed The Dodd-Frank Wall Street Reform and Consumer Protection Act (the "Act"). It is expected that the U.S. Senate will vote on and pass the legislation the week of July 12th, sending it on to the President for his signature shortly thereafter.

PwC's Financial services regulatory practice: How we can help asset managers
PwC can help address regulatory compliance issues and manage regulatory risk effectively. Our asset management regulatory team, a part of the firm’s national financial services regulatory practice, is comprised of experienced professionalswith diverse backgrounds in the asset management industry.

• Publications archive

Volcker hearing: Continued uncertainty is the only certainty - January 2012 At the congressional hearing on January 18, 2012, we heard directly from the leaders of the five key regulatory agencies for the first time on the Volcker Rule. The regulators generally confirmed what we had previously concluded about the Volcker Rule and validated our existing views on how firms should prepare.

Final CFTC Rules Addressing Swap Dealer - MSP Registration and Business Conduct - January 2012 On January 11, 2012, the CFTC approved a framework for registering swap dealers and major swap participants under Dodd-Frank and outlined their duties to swap counterparties. Swap dealers and MSPs need to evaluate their registration readiness and develop a strategy for registration and compliance with the numerous operational, disclosure and conduct requirements associated with registration.

SEC Staff Provides Guidance on the Use of Social Media by Advisers - January 2012 Reflecting the fact that many registered investment advisers and their personnel use social media in various forms to communicate with existing and potential clients and to promote their services, the SEC staff recently issued a National Examination Risk Alert providing suggestions for complying with the antifraud, compliance, and recordkeeping provisions of the federal securities laws.

Compliance Program Requirements for Private Equity Fund Advisers - January 2012 This FS Regulatory Brief describes considerations for private equity firms in creating and implementing a compliance program, and some action items that private equity firms can consider to help them in adopting a compliance program tailored to the particular compliance risks they face. It complements our earlier Closer Look pieces on Dodd-Frank: Impact on Alternative Asset Managers (August 2010) and Advisers to Private Equity Funds (May 2011).

The Federal Reserve’s proposal to implement enhanced prudential standards for large bank holding companies - December 2011 The Federal Reserve Board (FRB) issued a proposal to implement Sections 165 and 166 of the Dodd-Frank Act (Dodd-Frank or the Act) that it views as "package of enhanced prudential standards” on bank holding companies and on nonbank financial companies (NBFCs) that are designated for supervision by the FRB. Comments are due on the proposal by March 31, 2012.

• Banking Supervision at the Federal Reserve: The Times are a Changing - December 2011
  The executive vice president responsible for Bank Supervision at the Federal Reserve Bank of New York (FRBNY) recently addressed the New York Bankers Association and her address focused on the changes that the FRBNY has made to enhance the supervisory process both in terms of their staffing and supervisory approach.
  
  
• Supervisory Expectations on Capital Assessment - Stepping Up To Basel III - November 2011
  On November 4th, Governor Daniel Tarullo delivered a speech entitled "The International Agenda for Financial Regulation" before the ABA Banking Law Committee. While Governor Tarullo touched upon a number of topics including the additional efforts to complete international and domestic reform on capital and liquidity, cross boarder resolution, reliance on wholesale funding and OTC derivatives reform, his comments on capital, particularly how the US Supervisors will deal with the interim period, are of particular note.
  
  
• The SEC’s New Large Trader Reporting Requirements Place New Regulatory Obligations on Both Asset Managers and Broker-Dealers - November 2011
  In July 2011, the SEC adopted a new rule and accompanying form to establish a method for the SEC to identify large traders, obtain trading information for such traders and analyze such activity. The "Large Trader Rule" became effective October 3, 2011. The new rule will have significant impact on large traders, as well as on the sell-side firms that interact with large traders.
  
  
• Anti-corruption laws: Private equity not exempt - November 2011
  Over the past few years, there has been increased national and international attention directed at bribery and corruption related to business activities that involve government and pseudo-government entities and individuals. This heightened scrutiny has resulted in a greater focus by countries’ regulatory and law enforcement agencies on the financial services industry, including private equity firms.
  
  
• New reporting requirements for "exempt reporting advisers" - October 2011
  In June, the SEC adopted final rules as mandated by the Dodd-Frank Act to require many previously exempt advisers to private funds to become registered as investment advisers with the SEC. The final rules also establish new exemptions from the adviser registration rules.
  
  
• Domestic SIFIs: Resolution Plan Requirements Final Rule - September 2011
  The FDIC approved its final resolution plan rule for systemically important financial institutions (SIFIs) and an interim final rule regarding resolution plans for insured depository institutions (IDIs). This FS Regulatory Brief addresses the changes in the Final SIFI resolution rule from the earlier versions.
  
  
• Dodd-Frank act resolution plan final rule and interim FDIC final rule on resolution of large insured depository institutions - September 2011
  At its meeting on September 13, 2011, the board of the Federal Deposit Insurance Corporation approved a Final Rule on resolution plans required by the Dodd-Frank Act for systemically important financial institutions. The Federal Reserve Board is also expected to approve the Final Rule in the near future.
  
  
• FDIC Insured Depository Institution Resolution Plan Interim Final Rule - September 2011
  The Federal Deposit Insurance Corporation Interim Final Rule on resolution plans for insured depository institutions contains a number of significant changes from the related Notice of Proposed Rulemaking issued by the Federal Deposit Insurance Corporation on May 17, 2010, before passage of the Dodd- Frank Act. This regulatory brief discusses all the significant changes in detail.
  
  
• How the SEC’s custody rule impacts private fund advisers - August 2011
  This FS Regulatory Brief describes the Custody Rule and some considerations for private fund advisers as they prepare to register with the SEC. It complements our earlier A Closer Look pieces describing the impact of Dodd-Frank on asset managers, including SEC Adopts Final Rule for Investment Adviser Registration (July 2011) and Impact on Advisers to Private Equity Funds (May 2011).
  
  
• SEC’s current views related to trade allocation practices - July 2011
  This article analyzes the specific allocation practices challenged by the SEC and provides guidance on how investment advisers may fortify their investment allocation practices by: (1) implementing and following effective written allocation policies and procedures; (2) ensuring proper disclosure of allocation practices to clients and investors; and (3) keeping proper books and records with respect to trade orders and allocations.
  
  
• Update: The SEC’s New Rules on “Pay to Play” Restrictions for Investment Advisers - July 2011
  The SEC’s new rule prohibiting “pay to play” by investment advisers (Rule 206(4)-5 under the Investment Advisers Act of 1940) seeks to protect public pension plan beneficiaries by limiting the ability of investment advisers to influence investment management decisions by state and local government officials through the use of political contributions.
  
  
• New SEC Rule 15c3-5 Bans Unfiltered Market Access - July 2011
  On November 3, 2010, the SEC voted unanimously to adopt the new Rule 15c3-5 under the Exchange Act, effectively eliminating "naked" or unfiltered market access. In general, the compliance date for Rule 15c3-5 is July 14, 2011.
  
  
• SEC Proposes Amendments to Broker-Dealer Financial Reporting Rule
  Amendments call for broker-dealers’ assertion of compliance with the Financial Responsibility Rules, new reviews by independent auditors, and additional regulatory reporting requirements related to custody.
  
  
• Relief from July 16, 2011 Effective Date for Title VII Swap Provisions
  
  
• Amendments to Form ADV Part 2
  
  
• SEC Sweep Examination of Due Diligence processes for Alternative Investments
  
  
• Fund directors and the new proxy disclosure rules
  
  
• OTC Derivatives Regulatory Reform, February 2010
  
  
• SEC sweep examination of structured products
  
  
• PwC FS regulatory partner Carlo di Florio named director of SEC's OCIE
  
  
• Private equity qualifications for acquisitions of failed banks
  
  
• Proposed changes to Regulation Z (Truth in Lending)
  
  
• How might the CFPA impact fair lending enforcement
  
  
• Private Fund Investment Advisers Registration Act of 2009
  
  
• The SEC adopts indexed annuity governance rule
  
  
• SEC and State Attorneys General focus on pay-to-play
  
  
• Federal charter bill introduced in Congress
  
  
• New SEC focus on fund expenses
  
  
• Will regulatory scrutiny of model risk management intensify?
  
  
• SEC sweep examination of custodial controls
  
  
• Regulators collectively deny life insurance industry's request for 2008 capital and surplus relief, leaving states free to exercise independent judgment
  
  
• New credit card rules issued by Federal Regulators
  
  
• The Emergency Stabilization Act of 2008
  
  
• The expansion of the SEC investigation of market manipulation and FBI probe into financial companies
  
  
• The new SEC and FSA actions on short selling and disclosure requirements
  
  
• The recent remarks by the Comptroller of Currency on compliance supervision
  
  
• The SEC's Emergency Order to limit short selling in certain financial entities
  
  
• New SEC investment advisor examination request list
  
  
• Best practices for the hedge fund industry
  
  

A Practitioner’s Guide to Basel III and Beyond
The new Basel III accord strengthens bank capital requirements and introduces new regulatory requirements on bank liquidity and leverage. Its consequences will run far and deep.

Preparing for an age of tougher regulation - Asset Managment News, September 2010
Just two years after the credit crisis struck comes the regulatory aftershock. In the US, Europe and Asia, the shape of new regulations is becoming clear. Governments are subjecting asset managers to far tougher rules and more intrusive supervision. The asset management sector has never had to adapt to so much regulatory legislation in such a short time.

AIFMD News
This series of publications looks at the Alternative Investment Funds Management Directive (AIFM Directive) and its impact on the alternative investment industry.

UCITS IV: Time for change
PwC in conjunction with EFAMA (the European Fund and Asset Management Association) are conducting a series of surveys in relation to the implementation of the UCITS IV Directive. The objective of these surveys is to ascertain the intentions of the Asset Management industry and the challenges it faces with regards UCITS IV.

Preparing for take-off: Reaction to the Basel lll announcement of September 2010
On 12 September 2010 the Basel Committee announced broad agreement on a package that will significantly increase the capital and liquidity required by banks. The package has attracted huge interest around the world and maps an agreed flight path for the sector for the next ten years.

The new requirements are a big step forward in the development of the post-crisis regime for banks and, through that, a step towards reducing the risk of a second severe market crisis. Many commentators suggest that the job has now been done and that the banks and regulators can turn their attention elsewhere. This article examines our view on the announcement.

Emerging from the chrysalis: Reaction to the interim Basel announcement of July 2010
The Group of Governors and Heads of Supervision – the oversight body for the Basel Committee on Banking Supervision (BCBS) – announced on 26 July 2010 that it had reached broad agreement on many of the key elements of the proposed capital and liquidity reform package originally announced in December 2009. This comes shortly after the release of a consultation paper on countercyclical capital buffers.

In this briefing we provide our initial thoughts on the announcement.

Basel committee on banking supervision
In December 2009, BCBS released its proposals for strengthening capital and liquidity regulations: two consultation papers entitled ‘Strengthening the Resilience of the Banking Sector’ and ‘International Framework for Liquidity Risk Measurement, Standards and Monitoring’.

PwC has welcomed the opportunity to provide feedback on these two papers and submitted its response on 16 April 2010.

The Future of Financial Regulation in the UK
Following the Government’s announcement of proposals to change the structure of the financial services regulatory system in the UK, HM Treasury (HMT) has issued a Consultation Paper to provide further information on the planned restructuring and to initiate the consultation process.

Responses to the consultation are to be provided to HMT by 18 October 2010. The planned changes will have a significant impact on the future of UK regulation and we encourage our clients to take the time to review HMT’s proposals and provide a response.

Solvency II
Solvency II, the planned overhaul of prudential regulation for European insurers is well under way. Existing European solvency rules for life, non-life and reinsurers will be significantly upgraded. Structured around three pillars, Solvency II is a risk-based, forward-looking regulatory regime founded on a ‘total balance sheet’ and market-consistent approach. Companies will be given incentives to run their business with an increased focus on risk management, governance and enhanced disclosure.

Addressing key issues: Making sense of Solvency II
Here, we explore the key issues of Solvency II and provide insight into the challenges insurers face as they implement its requirements.

Countdown to Solvency II
Countdown to Solvency II is PwC's flagship Solvency II publication, exploring the latest developments in Solvency II. It provides insight into key issues and assists insurers in assessing the implications of the Solvency II directive and in preparing for the changes ahead.

Realising the full value of compliance: Protecting the brand
This survey, which includes responses from 76 financial institutions based in 16 European countries, provides a snapshot of the progress firms have made in establishing their compliance functions. It examines ongoing and new challenges and provides a benchmark against which to assess the potential future role of the compliance function in today’s changed environment.