• Rules for Banks Engaging in Retail Forex Transactions.

On April 4th, the Federal Reserve Board finalized the standards for banking organizations regulated by the Federal Reserve that engage in certain types of foreign exchange transactions with retail customers. The rule establishes requirements for risk disclosures to customers, recordkeeping, business conduct, and documentation for retail foreign exchange transactions. Regulated institutions engaging in such transactions will be required to notify the Federal Reserve and be well capitalized. They will also be required to collect margin for retail foreign exchange transactions. The rule will become effective on May 13, 2013. Federal Reserve Board Press Release.

• Federal Reserve Board Issues Nonbank Financial Company Definitions.

On April 3rd, the Federal Reserve Board approved a final rule that establishes the requirements for determining when a company is "predominantly engaged in financial activities." The requirements will be used by the Financial Stability Oversight Council when it considers the potential designation of a nonbank financial company for consolidated supervision by the Federal Reserve. The final rule also defines the terms "significant nonbank financial company" and "significant bank holding company." The final rule will become effective on May 6, 2013. Federal Reserve Board Press Release. The Washington Post noted the implications of the new rule, including the companies that are likely to be named "significant nonbank financial companies." Implications.

• Federal Reserve Governor Defends Proposed Foreign Bank Rule.

On April 3rd, Reuters summarized the remarks of Federal Reserve Governor Daniel Tarullo concerning the Federal Reserve Board's proposal that would require foreign banking organizations with a significant U.S. presence to create an intermediate holding company over their U.S. subsidiaries and maintain stronger capital and liquidity positions in the United States. Defense.

• OCC White Paper on CRE Guidance.

On April 3rd, the OCC published a white paper that presents findings from a study of bank performance in the context of the 2006 interagency guidance, "Concentrations in Commercial Real Estate Lending, Sound Risk Management Practices." The guidance established supervisory criteria for banks that exceeded 100 percent of capital in construction lending and 300 percent of capital in total commercial real estate ("CRE") lending. The study covered national- and state-chartered commercial banks but did not include savings associations. Among other things, the white paper found that banks with high concentrations of construction and total CRE lending that exceeded supervisory criteria failed at higher rates than banks with lower concentrations. OCC Press Release.

• FDIC Technical Assistance Videos.

On April 3rd, the FDIC released the first in a series of technical assistance videos to provide information to bank directors, officers, and employees on areas of supervisory focus and proposed regulatory changes. FDIC Press Release.

• CFPB Enforcement Action Against Mortgage Insurers.

On April 4th, the Consumer Financial Protection Bureau announced enforcement actions concerning allegedly improper kickbacks paid by mortgage insurers to mortgage lenders in exchange for business. The CFPB filed complaints and proposed consent orders against four national mortgage insurance companies seeking more than $15 million in penalties. CFPB Press Release.

• Unblocking Notice.

On April 3rd, the Treasury Department announced the removal of the Colombian professional soccer team America de Cali (also known as Corporacion Deportiva America) from the list of Specially Designated Nationals and Blocked Persons. Treasury Department Press Release. On April 4th, the Treasury Department's Office of Foreign Asset Control published in the Federal Register the name of one individual and one entity whose property and interests in property were blocked pursuant to the Kingpin Act. Separately, OFAC published the names of nine individuals whose property and interests in property have been unblocked pursuant to Executive Order 12978, "Blocking Assets and Prohibiting Transactions with Significant Narcotics Traffickers."

• Filing Requirements for Dually Issued Clearing Agencies.

On April 3rd, the SEC published a new final rule that streamlines the process for rulemaking by clearing agencies that are registered with both the SEC and the CFTC. The new rule amends an interim rule adopted in 2011 that allowed rule changes filed with the SEC by clearing agencies to become effective as soon as they were filed when they were not related primarily to securities futures and did not significantly affect the clearing agencies' securities clearing operations. The final rule expands upon the interim rule to permit effectiveness upon filing for rule changes that concern other products that are not securities - including swaps that are neither mixed swaps nor security-based swaps, and forwards that are not security forwards - provided those rule changes do not significantly affect the clearing agencies' securities clearing operations. The final rule also includes a new provision that under certain conditions permits temporary immediate effectiveness for rules that significantly affect the clearing agency's securities-clearing operations when the products themselves are not securities. The new rule will become effective 60 days after publication in the Federal Register, which is expected shortly. SEC Press Release.

• Large Trader Reporting Requirements.

On April 3rd, the SEC issued an order temporarily exempting certain broker-dealers from the recordkeeping, reporting, and monitoring requirements of Securities Exchange Act Rule 13h-1 concerning large trader reporting. The order extends to November 1, 2013, the date by which broker-dealers must comply with the Phase Two requirements of Rule 13h-1. SEC Release No. 34-69281.

• Regulation FD and Social Media.

On April 2nd, the SEC issued a report clarifying that companies can use social media outlets like Facebook and Twitter to announce key information in compliance with Regulation Fair Disclosure so long as investors have been alerted about which social media will be used to disseminate such information. The SEC's report of investigation confirms that Regulation FD applies to social media and other emerging means of communication used by public companies the same way it applies to company websites. The report notes that disclosure of material, nonpublic information on the personal social media site of an individual corporate officer (without advance notice to investors that the site may be used for this purpose) is unlikely to qualify as an acceptable method of disclosure under the securities laws. SEC Press Release.

• Updated Guidance on Foreign Broker-Dealer Registration.

On April 2nd, the SEC's Division of Trading and Markets updated its answers to frequently asked questions concerning Securities Exchange Act Rule 15a-6, which provides conditional exemptions from broker-dealer registration for foreign broker-dealers.

• Open Meeting.

The SEC will hold an open meeting on April 10, 2013 to consider whether to adopt new rules and guidelines, jointly with the CFTC, to require certain entities that are subject to the Commissions' respective enforcement authorities to establish programs to address risks of identity theft. Meeting Notice.

• Financial Reporting Manual Updated.

On April 4th, the SEC's Division of Corporation Finance updated the Financial Reporting Manual on issues related to age of financial statements in foreign private issuer initial public offerings, Regulation S-X requirements for foreign private issuers, financial statement requirements for foreign incorporated acquirees or investees that do not qualify as a foreign business, and other changes. Summary of Changes.

• Chiquita Seeks to Block SEC FOIA Production.

On April 4th, Bloomberg reported Chiquita Brands has sued the SEC in an effort to prevent the Commission from disclosing documents in response to a Freedom of Information Act request. The documents, which are sought by the National Security Archive, relate to payments made by the company to paramilitary groups in Colombia. FOIA.

• OIG Reports on SEC Data Safeguards.

On April 3rd, the SEC's Office of the Inspector General released two reports: "Audit of the SEC's Filing Fees Program" and "Audit of SEC's Controls over Support Service, Expert and Consulting Service Contracts." Summarizing the reports, Reuters reported the OIG found that the SEC needs to improve the safeguards the Commission uses to protect private company data. Summary.

• Form 13F Filers.

On March 29th, the SEC announced that beginning April 29, 2013, filers must file their Form 13F using the online form on the EDGAR Filing Website and construct their Information Table according to the EDGAR XML Technical Specification. Filings made after 5:30 p.m. on Friday April 26, 2013 using the current format will be suspended. Notice.

• Dual Registrants.

On March 29th, the CFTC approved final regulations governing dual and multiple associations of associated persons ("APs") of swap dealers ("SDs"), major swap participants ("MSPs"), and other registrants. The regulations make clear that each SD, MSP and other registrant with whom an AP is associated is required to supervise the AP and is jointly and severally responsible for the activities of the AP with respect to customers common to it and any other SD, MSP or other registrant. The new rule will become effective 60 days after publication in the Federal Register, which is expected shortly. CFTC Press Release.

• No-Action Relief for Securitizations.

On April 2nd, the CFTC's Division of Swap Dealer and Intermediary Oversight issued a time-limited letter stating that DSIO will not recommend that the Commission take enforcement action against the commodity pool operators of securitization vehicles that are required to register by March 31, 2013 for failure to comply with certain enumerated sections in Part 4 of the Commission's regulations prior to June 30, 2013, if the commodity pool operators of securitization vehicles comply with the guidance set forth in the letter with respect to those sections. CFTC Press Release.

• Swap Clearing Exemption for Affiliated Companies.

On April 1st, the CFTC exempted affiliated companies from having to centrally clear their swaps. Under the final rule, affiliated counterparties may elect not to centrally clear a swap if those counterparties are majority-owned affiliates whose financial statements are included in the same consolidated financial statements and both affiliated counterparties elect not to clear the swap. In addition, both affiliated counterparties must elect not to clear the swap, the terms of the swap must be documented in a swap trading relationship document, the swap must be subject to a centralized risk management program that is reasonably designed to monitor and manage the risks associated with the swap, and each swap entered into by the affiliated counterparties with unaffiliated counterparties must be cleared. The new final rule also sets forth the requirements for clearing swaps with unaffiliated counterparties. Those clearing requirements may be met by: (1) complying with the CFTC's clearing requirement; (2) complying with a foreign jurisdiction's clearing mandate that the CFTC has determined is comparable; (3) complying with an exception or exemption from the clearing requirement under the Commodity Exchange Act or CFTC regulations; (4) complying with an exception or exemption under a foreign jurisdiction's clearing mandate; or (5) clearing such swaps through a registered derivatives clearing organization. The final rule also requires the reporting counterparty to report to a swap data repository certain information. The new rule will become effective 60 days after publication in the Federal Register, which is expected shortly. CFTC Press Release.

• Compliance Date for Certain Swap Recordkeeping Obligations Extended.

On April 1st, the CFTC's Division of Swap Dealer and Intermediary Oversight issued time-limited no-action relief for swap dealers ("SDs") and major swap participants ("MSPs") concerning certain recordkeeping obligations under Part 23 of the Commission's Regulations. The no-action letter will delay until June 30, 2013 the compliance date for the following provisions: (1) for landline telephones that are not located in one of the following geographic jurisdictions: United States, United Kingdom, Singapore, Hong Kong, Japan, Australia, Switzerland, and Canada, the requirement that SDs and MSPs make and keep records of all oral communications related to pre-execution swap trades; (2) the requirement that SDs and MSPs maintain all transaction records and daily trading records in a manner "identifiable and searchable" by transaction and counterparty, subject to the condition that firms continue to maintain such records using existing search capabilities in their relevant systems; (3) the requirement that SDs and MSPs use a Coordinated Universal Time; and (4) the requirement that SDs and MSPs retain swap records at their principal places of business or such other principal offices as designated by the SD or MSP, subject to the condition that records be promptly available upon request. CFTC Press Release.

• No-Action Relief Granted to RTOs and ISOs.

On March 29th, the CFTC announced that staff from the Division of Clearing and Risk, Division of Market Oversight, and Division of Swap Dealer and Intermediary Oversight issued no-action relief in order to give Regional Transmission Organizations and Independent System Operators time to enact certain tariff, protocol or rate schedule changes and take other steps necessary to satisfy the conditions of the exemption granted to them in the related final order of March 28, 2013. CFTC Press Release.

• Commissioner Chilton Calls for No-Action Position for End Users.

On April 3rd, Bloomberg reported CFTC Commissioner Bart Chilton is asking the agency not to enforce central clearing requirements on swap end users for the next six months. Chilton said that through October, he would oppose any enforcement action brought against an end user who is attempting to comply with the new swap clearing rules. No Action.

• Consumer Financial Protection Bureau

June 1, 2013 (Amendments) – Loan Originator Compensation Requirements Under the Truth in Lending Act (Regulation Z). 78 FR 11279.

• Federal Housing Finance Agency; Federal Housing Finance Board

April 12, 2013 – Repeal of Disclosure Regulations. 78 FR 15869.

• Federal Reserve System

May 6, 2013 – Definitions of "Predominantly Engaged In Financial Activities" and "Significant" Nonbank Financial Company and Bank Holding Company. 78 FR 20755.

• National Credit Union Administration

April 1, 2013 – Chartering and Field of Membership Manual for Federal Credit Unions. 78 FR 13460.

• Proposed Change in the Collection of Participant's Fund Deposits Is Effective Immediately.

On April 2nd, the SEC provided notice of The Depository Trust Company's filing of a proposal that enhances its liquidity and risk coverage. The proposal accelerates the collection of Participants' Required Participants Fund Deposits from two business days to the same day the Participant is notified of the requirement. The proposed amendment is effective immediately. Comments should be submitted within 21 days after publication in the Federal Register, which is expected during the week of April 8. SEC Release No. 34-69276.

• ISDA Paper on the Capital Treatment of Risk Exposure.

On April 2nd, the International Swaps and Derivatives Association published a paper on the capital treatment for clearing member exposure to central counterparty default funds. Paper.

• MSRB Campaign Disclosure Rules Approved.

On March 28th, the SEC approved the Municipal Securities Rulemaking Board's proposed revisions to MSRB Rule G-37, which requires dealers to disclose certain contributions to issuer officials, contributions to bond ballot campaigns, and payments to political parties of states and political subdivisions, made by brokers, dealers and municipal securities dealers and their affiliates. SEC Release No. 34-69249.

• Physical Copper ETF.

On March 28th, the SEC reiterated its approval of NYSE Arca's proposed listing and trading of exchange traded funds holding physical copper. SEC Release No. 34-69256.

• U.S. Supreme Court to Resolve Forum Selection Debate.

On April 1st, the U.S. Supreme Court granted certiorari to resolve a conflict between the federal appellate courts concerning how and when contractual forum selection clauses should be enforced. The case is Atlantic Marine Construction Co. v. USDC WD TX. Questions Presented.

• Even Sophisticated Investors Should Read the Fine Print.

On April 1st, the Second Circuit affirmed the district court's finding that UBS did not violate SEC Rule 10b-16, which requires brokers to disclose to their customers the brokers' margin maintenance requirements. Plaintiffs, UBS margin account holders, claimed that UBS failed to disclose its actual margin rules and failed to provide written notice before it revised those rules, in violation of Rule 10b-16. The Court, however, held that UBS's disclosures did not violate Rule 10b-16(a) even though UBS did not expressly disclose the more complex formulas it employed to calculate plaintiffs' collateral requirements. Where, as here, a broker discloses its generally applicable margin policies and also indicates that more specific information about its margin policies is available to the customer, it need not disclose the precise, complex formulas it uses to calculate its collateral requirements. Moreover, Rule 10b-16(b) does not require a broker to provide advance notice to customers before it changes its margin policies. WC Capital Mgmt. v. LLC v. UBS Securities LLC.

• LIBOR Lawsuit Largely Lost.

On March 29th, a federal District Court dismissed all but certain Commodity Exchange Act claims brought in the consolidated cases stemming from the alleged manipulation of the London Interbank Offered Rate. The antitrust claims were dismissed for failure to plead an antitrust injury and the Racketeer Influenced and Corrupt Organizations Act claims were dismissed as barred by the Private Securities Litigation Reform Act and because the complaint inappropriately alleged a foreign RICO enterprise. In re LIBOR-Based Financial Instruments Antitrust Litigation.

• SEC's Suit against Ex-Freddie Mac Execs Proceeds.

On March 28th, a federal District Court refused to dismiss the Securities Exchange Act claims filed by the SEC against certain former executives of Freddie Mac. The Court held that the executives were not exempt from the Exchange Act and that the SEC adequately alleged defendants made material misrepresentations concerning Freddie Mac's exposure to subprime loans and adequately alleged defendants' scienter. However, Securities Act claims were dismissed because the SEC did not allege that defendants personally gained money or property from Freddie Mac's stock offerings. SEC v. Syron.

• Banks Respond to Basel Committee's Securitization Proposal.

On April 4th, Bloomberg summarized the comments submitted to the Basel Committee in response to its proposed "Revisions to the Basel Securitization Framework." Comments.

• GAO Reports on 401(k) Plan Rollovers.

On April 3rd, the Government Accountability Office published a report on the steps the Labor and Treasury Departments could take to reduce obstacles and disincentives to plan-to-plan rollovers when 401(k) plan participants separate from their employers. The agencies should ensure that plan participants receive complete and timely information, including enhanced disclosures, about the distribution options for their 401(k) plan savings when separating from an employer. The Washington Post summarized the Congressional response to the report, noting that Senators Tom Harkin and Bill Nelson, along with Representative George Miller, have written the Labor and Treasury Departments asking that rules requiring uniform disclosure and clearer IRA fee disclosure be required. Request.

• European Money Market Funds Respond to Zero Interest Rates.

On April 3rd, Bloomberg reported European money market funds are restructuring in response to zero and negative interest rates. To avoid having their net asset values ("NAV") fall below €1, some funds will restructure to allow for the cancellation of shares while other funds are moving to a floating NAV. Fund Restructuring.

• Congressional Gridlock.

On April 3rd, the Washington Post discussed the very different philosophical beliefs held by the two new leaders of the House Financial Services Committee, Chairman Jeb Hensarling and Ranking Member Maxine Waters, and whether those differences can be overcome. Gridlock.

• Going Dark.

On March 31st, the New York Times discussed the migration of stock trading from the large exchanges to private trading platforms and the risks that migration poses. Dark Pools.

• Insider Trading Prosecutor Profiled.

On March 29th, the Los Angeles Times profiled Preet Bharara, the U.S. Attorney for the Southern District of New York who has filed some of the most high-profile insider trading charges. Profile.

• Antitrust and Competition—The EU Weekly Briefing, Vol. 1, Issue 22.

Antitrust and Competition — The EU Weekly Briefing is designed to provide timely updates on recent European Union competition law by including a short description of, and links to, recent developments. EU Weekly Briefing.

• Corporate and Business Law Update — London Calling - Spring 2013.

Winston & Strawn London Corporate and Business Law Update contains some of the key changes for those operating or contemplating operating in the United Kingdom. Corporate and Business Law Update.

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