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Chinese affiliates of major audit firms and market professionals were the focus of securities enforcement litigation this week. Five PRC based affiliates of major international accounting firms were named as Respondents in an administrative proceeding the Commission directed be filed under Rule 102(e). The action potentially has far reaching consequences since the PRC based affiliates of the audit giants could be precluded from appearing and practicing before the Commission. Such a ruling could effectively deny access to the U.S. capital markets for Chinese issuers.
The Commission also filed two insider trading cases centered on market professionals. In one a market professional is alleged to have been at the center of a ten person, years long insider trading ring. In another the founder of an unregistered investment advisor used confidential information obtained in a bidding process to engage in insider trading, according to the allegations. Both cases are in litigation.
Remarks: Commissioner Luis Aguilar addressed the AICPA Conference on Current SEC and PCAOB Developments, Washington, D.C. (Dec. 3, 2012). His remarks included comments on the loss of investor confidence, understanding capital formation, investor protection, relying on the integrity of foreign audits, the role of the PCAOB and the importance of internal controls (here).
Remarks: Norm Champ, Director, Division of Investment Management, addressed the ALI CLE 2012 Conference on Investment Adviser Regulation, New York City (Dec. 6, 2012). His comments reviewed the work of the staff in a number of areas including Dodd-Frank, Form PF, the JOBS Act and the use by Funds of derivatives. He also commented on future division priorities (here).
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For more cutting edge commentary on developing securities issues, visit SEC Actions, a blog by Thomas Gorman.
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