SEC RELEASES SAMPLE LETTER OF COMMENTS ON CLIMATE CHANGE
On September 22, staff in the SEC’s Division of Corporation Finance (Staff) released a sample comment letter on climate change disclosures. A brief statement preceding the sample comment letter reiterates the view expressed in the SEC report Interpretation guide 2010 that a variety of existing SEC disclosure rules may require companies to disclose current and potential future material impacts of climate change on the business and the financial condition and performance of the company. Staff conducted a thorough review of climate change disclosure and compliance in Form 10-K reports. When staff have questions about a company’s climate change disclosures, they have sent a comment letter to the company, and the sample comments reflect the staff’s experience during this review, which is in progress. Classes. The sample comment letter emphasizes the importance of a thorough review of information provided by companies on climate change and related issues, both in documents filed with the SEC and in documents such as reports. on Corporate Social Responsibility (CSR) that companies prepare and post on their websites.
Read it customer alert to find out what companies should do in response and what’s on the horizon.
SOCIAL MEDIA INFLUENCERS, CUSTOMER ACQUISITION AND RELATED INFORMATION PROTECTION
On September 16, FINRA announced that it will conduct a review brokerage firm practices to assess how companies use social media influencers (Influencers) for self-promotion and how they protect customer data from social media activities. The FINRA review will cover social media communications from January 1, 2020 until a date this year to be specified by FINRA; however, the end date will vary by company. According to the ad, an influencer is defined as “any third party with whom the company contracts or pays to provide communications on social networks.” Social Media Communications (SMC) is defined as “any communication with the public, including the provision of any content or advertising relating to or on behalf of the company, carried out in accordance with an agreement with a third party, via social media “. FINRA asks companies to detail how they find and pay influencers and to provide any SMCs disseminated by influencers on behalf of companies. FINRA will assess written policies and procedures for overseeing social media marketing, including whether companies comply with SEC rules regarding the protection of clients’ financial and personal information. FINRA has yet to announce how many companies are targeted for the review.
NEXT OTC BULLETIN BOARD RETIREMENT
On September 17, FINRA announcement in Regulatory Notice 21-28 that the OTC Bulletin Board (OTCBB) will cease its activities. As such, members and suppliers are encouraged to prepare for the closure. Although the closing date has not yet been set, it could take place as early as the fourth quarter of 2021; However, FINRA has confirmed that the closure will not take place until October 1, 2021.
FDIC LAUNCHES NEW MISSION-FOCUSED BANKING FUND
On September 16, the FDIC announcement the launch of a new mission-oriented banking fund (fund) to support minority depository institutions (MDIs) and community development finance institutions (CDFIs) insured by the FDIC. Microsoft and Truist Financial Corporation will lead the investment as key investors, with Discover, Inc. joining as founding investor. The combined initial commitment to the Fund is $ 120 million, with additional investments expected. The Fund is a collaborative investment framework designed to stimulate capital investment and other funding for MDIs and CDFIs that support low and moderate income communities, minorities and rural communities. The FDIC will retain an advisory role with respect to the Fund; however, it will not contribute capital, manage or have any involvement in the investment decisions of the Fund.
BANK SUPERVISION ISSUE: NEW CONTROLLER MANUAL BOOKLET AND REVISIONS
On September 13, the OCC Posted a new booklet, “Supervision of problem banks” (the booklet). The brochure identifies the OCC’s approach to the timely identification and rehabilitation of problem banks, which includes advanced supervision, execution and resolution strategies. The recently published brochure incorporates OCC Bulletin 2018-33 titled “Prompt Corrective Action: Guidelines and Recisions”, replaces “An Examiner’s Guide to Problem Bank Identification, Rehabilitation, and Resolution” (January 2001), and provides an in-depth discussion on the OCC authority under 12 CFR Part 6.
“Microsoft and Truist have answered the call to become benchmark investors and help the FDIC grow this fund for the benefit of mission-driven banks and, more importantly, the people and places these institutions serve. “
– Jelena McWilliams, President of the FDIC
SEC MAKES CYBERSECURITY A HIGH PRIORITY; SANCTIONS UNDERTAKEN FOR BREACH OF CYBERSECURITY
There’s no question that the SEC is making cybersecurity a top priority. As part of these growing efforts, on August 30, the SEC sanctioned eight registered investment dealers and advisers (including various affiliates) for failing to implement and / or changing cybersecurity practices as a result of data security incidents.
According to the SEC, each of the eight companies was the victim of a business email compromise. Each compromise has gone on for over a year, some for nearly three years, undetected and resulting in the exposure of the personal information of thousands of customers and corporate customers.
Read it customer alert to learn more about the violation and key takeaways.