Citadel Securities Urges SEC to Take Oversight of Some Wagers

Citadel Securities told regulators that prediction market contracts linked to publicly-traded companies should be overseen by the Securities and Exchange Commission instead of the agency that has taken responsibility for them so far, the Commodity Futures Trading Commission.

The firm wrote in a letter Wednesday that contracts tied to "key performance indicators" are security-based swaps that fall under the SEC's purview and warned regulators that oversight by the CFTC risks market fragmentation.

by bloomberg.com

New Sheriff of ‘Y’all Street’ Beefs Up as Finance Heads to Texas

Now, as financial firms move operations south, the top federal attorney in Dallas wants Texas to become a center for white-collar prosecutions.

Texas Builds Wall Street Enforcement Muscle As Firms Move South
Ryan Raybould, the US Attorney for the Northern District of Texas, says he is creating the first dedicated securities-fraud unit in the office’s history, modeling the section on operations in New York and Los Angeles as banks, investment firms and exchanges expand their presence in Dallas.

“With the launch of Y’all Street, we are going to have to be thoughtful regulators for all markets,” Raybould, 43, said in an interview. “We have to be the regulators of our own markets.” He said it was “absurd” that a company in Dallas or Fort Worth should be policed principally from New York.

by Bloomberg Law

DOJ targets Xinbi Guarantee network, restrains over $52M in crypto

The US Department of Justice said on Sept. 9 that its Scam Center Strike Force seized two crypto wallets containing approximately $12 million and sought restraints against another 47 wallets believed to be connected to money laundering through Xinbi and vendors serving scam operators.

The two seized wallets were used by Xinbi to collect payments for vendors operating through its marketplace. Combined with the other restraints, the operation placed more than $52 million in crypto beyond the reach of Xinbi and its vendor network, according to the DOJ.

Tether assisted investigators with the operation, the department said. The stablecoin issuer had separately frozen $39.3 million in USDT across 10 Tron addresses linked to Xinbi earlier this week, crypto.news previously reported.

by crypto.news

Proxy Advisors in the Hotseat: SEC Enters the Fray

As Dave recently predicted, it was only a matter of time before the SEC entered the multi-front battle against major proxy advisors. Sure enough, the SEC announced late last week that it is suing ISS in federal court to compel compliance with an outstanding administrative subpoena.

The SEC's announcement and its Memorandum of Law reveal that Staff from the SEC's Division of Examinations initiated an examination of ISS back in March. (ISS is a registered investment adviser, regulated by the SEC and subject to SEC oversight and examination.)

Among other things, the SEC examination team requested that ISS produce data relating to proxy recommendations and votes, which the SEC's Memorandum characterizes as the core of ISS's business, including information like the names of clients who received proxy recommendations and information about votes cast on their behalf, and requested that the information, which ISS maintains in its ProxyExchange system, be produced in Excel format.

by TheCorporateCounsel.net

How Securities Lawyers Can Future-Proof Careers as Market Shifts

Securities lawyers are facing a market in flux. Regulatory changes, the growth of private capital, and new technology are challenging assumptions that have shaped securities practice for decades.

For lawyers whose careers have been built around those assumptions, that creates a new kind of uncertainty: What expertise will continue to matter as the market changes?

Rewritten Rules

Securities and Exchange Commission Chairman Paul Atkins has made revitalizing the public markets a central part of his agenda, including changes to rules around public-company reporting and capital raising. Meanwhile, private markets are becoming increasingly accessible to investors while regulators and market participants are exploring how tokenization could alter how securities are issued, traded, and settled.

These developments point to a securities market that may look meaningfully different from the one many lawyers built their practices around. Boundaries that securities lawyers have long worked within are becoming less distinct.

The question isn't simply which rules will change, but whether the assumptions underlying established securities practices in law firms will change with them.

by news.bloomberglaw.com

Trust companies turn away crypto-rich on money-laundering fears

Wealthy crypto entrepreneurs and traders are increasingly being turned away by trust companies worried about the volatility and money-laundering risks associated with digital assets.

A growing number of people who either invested their inherited wealth in crypto or made huge gains from crypto businesses or bets on tokens have been seeking to put their assets into an offshore trust structure to protect them for future generations or for tax savings.

But trust companies are becoming nervous about accepting either the volatile digital tokens themselves or the potentially opaque profits from the sale of these assets, say lawyers and trustees.

by FT Cryptofinance