By David Drake The art and financial sector has been abuzz for the past months: the rise of NFTs or non-fungible tokens has been garnering attention and quite the sum. Some of you may have heard of NFTs and how some of these assets are worth millions of dollars. Recently, the hype with NFTs came to an all-time high as famous artists, content creators, investors, and celebrities are getting involved in the space.   But what are NFTs for? How do NFTs work? In layman’s terms, NFT stands for non-fungible tokens. Non-fungible asset is a unique item that is not interchangeable with an ..read more

By: David Drake 2020 was a year full of unfamiliarities. COVID-19 was an uninvited visitor that barged itself into our lives and decided to wreak havoc on our fragile world. It caught all of us off-guard and forced us to accept this difficult reality. Several industries bore the brunt of COVID-19, and businesses were barely keeping their heads afloat. Millions filed for unemployment, the global economy went on roller-coaster mode, and government leaders were grasping at straws to regain control of their respective countries.  Drastic quarantine measures were implemented in the first part ..read more

By: David Drake The coronavirus disease or COVID-19 outbreak single-handedly defined 2020 as this pandemic severely affected industries, economies, and the way of life around the world. Financial markets, stocks, and companies around the globe had a turbulent year and faced major setbacks like the imposed global lockdowns and termination of business operations.  After several months of quarantine, the world is reeling from the effects of the pandemic and companies have started to adapt and look for ways to turn their investments around. News of COVID-19 vaccines being developed and being ..read more

Dear Friends, On May 12, 2014, the CFTC announced a streamlined approach for considering requests for no-action relief with respect to CPOs who delegate certain activities to a registered CPO (e.g. GPs of limited partnerships who delegate CPO authority to a registered investment manager). Each delegating CPO must submit a letter certifying it meets certain criteria outlined in the release.  However, the CFTC will continue to consider requests for CPO registration relief for delegating CPOs in instances where the criteria cannot be met. This approach is expected to allow the CFTC to more e ..read more

By David Drake   Direct Public Offering, also known as Regulation A+, is poised to significantly bring down the cost of raising capital for businesses in the US when it becomes legal. And when it does, it could overshadow even its more popular regulatory sibling under the JOBS Act – Crowdfunding.   Such incidences like paying up to $250,000 in legal fees for a target capital raise of $5 million, under its current version Regulation A, will be thwarted with this new regulation as the limit increases  to $50 million.   Regulation A+ is expected to greatly influence direct pub ..read more

Dear Friends, On March 31, 2014, the SEC issued Guidance regarding Rule 206(4)-1(a)(1) of the Investment Advisers Act (“the testimonial rule”) and social media. The SEC generally prohibits client testimonials. However in its guidance, the SEC said client testimonials on independent social media sites are permissible, in certain circumstances, with the following important considerations: An investment adviser (“IA”) or investment advisory representative (“IAR”) may publish all unedited testimonials about the IA or IAR from an independent social media site on the IA’s or IAR’s own social media ..read more

Dear Friends, On March 31, 2014, the SEC announced the following charges against two men that traded on confidential information from their wives: Tyrone Hawk overheard his wife’s work calls indicating that her company, Oracle Corp., was planning to acquire Acme Packet Inc.  Hawk violated a duty of trust when he purchased Acme Packet shares prior to the acquisition and reaped approximately $150,000 by selling after the stock price rose 23% on the news.  He agreed to pay more than $300,000 to settle the SEC’s charges. In a separate case, Ching Hwa Chen profited from overhearing hi ..read more

Dear Friends, On March 10, 2014, FINRA filed a proposal with the SEC requiring brokers who receive more than $100,000 in incentive compensation to switch firms, to disclose to clients how much they are paid. Brokers would disclose a compensation range in $500,000 to $1,000,000 bands. The proposed rule was approved by FINRA in September 2013, in an effort to ensure that customers are aware of potential conflicts of interest in the recruiting process. The main goals of the rule are to: Clarify to customers the possible costs of moving with their broker to a new firm; and Assist FINRA examiners ..read more

  Dear Friends, The SEC has released a No-Action letter providing guidance on individuals who qualify as “knowledgeable employees” under Rule 3c-5 of the Investment Company Act of 1940. The Rule defines knowledgeable employee as any natural person who is an “executive officer, director, trustee, general partner, advisory board member, or person serving in a similar capacity” of a private fund or private fund adviser. The no-action letter further clarifies that the following are also considered knowledgeable employees: An executive officer of a principal business unit, which may be deter ..read more

By David Drake, The Soho Loft   The year 2014 will be full of change and innovation in the finance and investing landscape as many newcomers will enter the game of finance. Here are some of the changes and trends that we see for the year 2014:   1. JOBS Act   SEC will try to make it clear for investors whether an IT platform offering 506(c) securities is acting like a VC Fund, a bulletin board or a broker-dealer. There is some confusion on this now, but that will soon be clear. There will be attrition in the pending Funding Portal community as many aspiring funding portals will ..read more