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Now that I'm no longer watching C-SPAN 3's version of The Good, The Bad and The Ugly, here are a few reminders about real regulatory matters that are not being debated anywhere on TV:
INVESTMENT BANKERS: Remember: if you are an investment banker you can opt-in to the new IB exam by filing a U4 amendment instead of taking the Series 79 exam. But you only have until May 3 to do it! See my July 30, 2009, entry for the details.
PRIVATE PLACEMENTS: For those of you doing private placements, check out Notice 10-22. The Notice, in my opinion, does not go as far as it should in clarifying expectations. It remains vague and incomplete. A few comments: they lay the responsibility for the PP Memorandum on the firm that prepared it or assisted in its preparation, but expect you to fill in any holes if you perceive them; if you didn’t prepare the PPM, you still have responsibility for any sales literature you distribute, whether or not you prepared it; and you may rely on counsel or syndicate managers to prepare the PPM and do due diligence, as long as you have confidence in that third party (and have documented your vetting process). Oh, and yes, you have to determine suitability of your investors—even if they are accredited. You already knew that, but now it’s official.
The Notice includes a list of due diligence topics. For those of you putting together offerings and charged with this responsibility, it would be behoove you to review the list to make sure you are currently addressing these areas of investigation.
PRIVACY NOTICES: As I noted in my January 28, 2010, entry, SEC has put out a 'model form' to use as your privacy notice. There are difference versions, depending on opt-out options. Here is a link to SEC’s newly released Privacy Form Builder. This site provides links to the different model forms. If you do not use the model form, which assures safe harbor if customized correctly, then you must make sure your privacy notice conforms to Reg. S-P changes by year-end.
...and havin' a blast! Yes, I'm spending my day watching the Goldman hearing. I didn't plan to do this, it just happened. But I'm sure glad it worked out this way. I vacillate between hating the senators and hating the GS kids. And between loving the senators and loving the boys. Sometimes the conversation looks like my 17-year-old son trying to explain the difference between the music of Lil Wayne and P. Diddy to an 85-year-old Belarusian who speaks no English. The knowledge divide is immense! But there's plenty of CYA and political rhetoric to go around, that's for sure. I respect Mr. Sparks' attempts to explain the complexities of the market to his elders; I like Mr. Tourre's willingness to not rest on legalese; I get a huge kick out the predictability of Mr. Birnbaum's CYA-speak (he wins in this event); and the exasperated brevity of Mr. "Um"'s (forgot his name) responses. There's nothing new about this showdown and it was very easy to explain it to my teenage boys (who watched with me for quite a while, much to my surprise): I mean, c'mon, politicians expressing disbelief and anger at these apparently unethical, greedy players versus slick, coached, extremely experienced and smart professionals defending their daily grind and covering for their employers?...not hard to explain. They could be speaking Farsi and we'd all still get it.
My problem is, I see both sides. I respect the skill of Wall Street bartenders, but I, like many, have suffered thanks to their concoctions. They made great lemonade, as Mr. Sparks said, but it was folks like me and my neighbors that were left to suck the lemon rinds.
And yet, can I trust our DC reps to sort this out and come up with the best answer? I'm not that drunk..
