Welcome to SEC Roundup, a bimonthly video sequence by former Securities and Change Fee senior trial counsels Nick Morgan and Tom Zaccaro, founders of the nonprofit advocacy group Investor Alternative Advocates Community.
On this episode, Chris Iacovella, president and CEO of the American Securities Affiliation, explains ASA’s current lawsuit filed in opposition to the SEC for data below the Freedom of Info Act regarding the SEC’s eye-watering penalties in opposition to sure broker-dealers for purportedly failing to retain “off-channel” communications.
In September 2021, the SEC started to research sure broker-dealers’ retention of “off-channel” communications, reminiscent of textual content messages on private gadgets, states the lawsuit, filed by ASA, a commerce group representing regional monetary providers companies, within the U.S. District Courtroom for the Center District of Florida.
The difficulty of how the SEC calculates penalties (notably within the quantities at subject within the broker-dealer settlements) shouldn’t be hidden from the general public for examination and scrutiny, based on ASA’s lawsuit.
ASA states that it filed three FOIA requests for information in March regarding the SEC’s “off-channel” communications sweep. The SEC, nonetheless, has refused to provide any paperwork, ASA stated.
“While you ask for that transparency and also you don’t get it, it leads you to imagine one thing else is happening,” Iacovella says. “The phrases arbitrary and capricious continues to come back up because it pertains to this [texting] high quality construction.”
See the video for the dialogue with Iacovella.