• Basel Committee to Broaden Liquidity Categories.

On March 23rd, Reuters reported that the Basel Committee on Banking Supervision, which met earlier this week, will most likely broaden the category of assets banks can use to meet short-term liquidity requirements. Liquidity.

• SEC Examines High-Frequency Traders.

On March 23rd, the Wall Street Journal reported that the SEC is examining whether high-frequency traders are using their ties to electronic trading platforms to obtain an unfair advantage. Examination. Coincidentally, a possible "fat finger" mistake at BATS Exchange, one of the platforms the SEC is investigating as part of its probe, reportedly sparked a 9 percent drop in the price of Apple stock, triggering the single-stock circuit breaker. See CNBC.com.

• SEC Subpoenas Gmail Accounts.

On March 23rd, Kansas City infoZine reported that the Electronic Frontier Foundation has filed an amicus brief with the Ninth Circuit in a collateral action seeking to quash third-party administrative subpoenas issued by the SEC to identify the owners of three Gmail accounts as part of its investigation into an alleged pump-and-dump stock scheme. Collateral Attack.

• Volcker Rule Update.

On March 22nd, Reuters provided an update on the Volcker Rule, the Dodd-Frank Act's prohibition against proprietary trading. Among other things, regulators will issue guidance on the prohibition in the likely event that rules implementing it will not be in effect by July 21, 2012. Volcker Rule Update. The New York Times' DealBook reported that Congressman Barney Frank wants regulators to rewrite the Volcker Rule's implementing provisions. Frank Comments.

• Continued Conflicts.

On March 22nd, Reuters reported that research analysts continue to feel pressure to positively report on the companies they cover despite regulatory efforts to combat conflicts of interest in the industry. Continued Conflicts.

• Social Media Compliance Providers.

On March 21st, the New York Times' DealBook discussed the newest industry to provide services to Wall Street: social media compliance providers. Twitter Compliance.

• Volcker Grades Regulatory Reform.

On March 21st, Bloomberg summarized the remarks of former Federal Reserve Board Chairman Paul Volcker, who gives regulatory reform a grade of "promising but definitely incomplete" and discusses issues which must still be addressed. Volcker Remarks.

• ERISA Enforcement.

On March 19th, CFO.com noted the Department of Labor's stepped-up ERISA enforcement activity and its emphasis on ERISA fiduciaries. Plan sponsors are urged to ask plan advisers to help minimize the sponsor's potential liability. ERISA Enforcement.

• CFTC Commissioner's Letter May Form Basis for Future Lawsuits.

On March 17th, the Washington Post's Wonkblog discussed CFTC Commissioner Scott O'Malia's letter to the Office of Management and Budget ("OMB") requesting OMB to review the CFTC's cost-benefit analysis of three Dodd-Frank Act rules. Although OMB is unlikely to act on O'Malia's request, the letter is sure to be used in future challenges of CFTC rulemakings. Challenges.

• Customer Segregation.

On March 15th, Business Week voiced various opinions offered on whether and how swap customer money should be segregated from each other, and from the brokerages holding their money. Customer Segregation.

• Resolution Resolve.

On March 15th, Reuters reported that the FDIC will soon schedule meetings with financial institutions, investors, and others in an effort to spread the word that the agency has the authority to break-up large firms, and is not afraid to do so. Resolution Authority.

• Securities Fraud Settlements.

On March 14th, Reuters summarized the results of Stanford law school's and Cornerstone Research's annual study of securities fraud lawsuits. While the total dollar figure for approved settlements in 2011 was the lowest since 2003, 2012 may prove to be different. Lawsuits.

• Insurance Rates.

On March 13th, the New York Times' DealBook reported that the insurance premiums which hedge funds must pay to insure against fraud and insider trading charges are 5 to 10 percent higher this year over last year. Insurance Rates.

• Proposed Auditing Standard Would Affect Executive Compensation.

On March 12th, CFO.com discussed the PCAOB's proposed auditing standard entitled, "Related Parties." The proposed standard is ostensibly aimed at public company related party transactions. But CFO.com notes the implications the proposed standard would have for executive compensation. Executive Compensation.

• Congressional Insider Trading Bill Passes.

On March 22nd, the Senate approved the House version of the Stop Trading on Congressional Knowledge Act, S.2038, which prohibits lawmakers, their staff, and certain members of the Executive Branch from trading on the confidential information they obtain through their work. The bill passed by both houses lacks two provisions present in an earlier version passed by the Senate. That proposal would have required political intelligence consultants to register as lobbyists and would have expanded public corruption laws. See, e.g., New York Times; Politico.

• Senate Passes JOBS Act.

On March 22nd, the Senate passed the JOBS Act, a bill approved by the House last week that makes it easier for smaller businesses to raise capital. The Senate version includes an amendment authored by Senator Jeff Merkley, which adds investor protection provisions to the crowdfunding portion of the bill. Regulators, however, continue to raise concerns over other aspects of the legislation. Vote.

• FDIC Publishes Technical Amendments to its Guidelines for Intra-Agency Appeals.

On March 23rd, the FDIC published technical amendments to its Guidelines for Appeals of Material Supervisory Determinations and Guidelines for Appeals of Deposit Insurance Assessment Determinations. The revised guidelines became effective on March 20, 2012. 77 FR 17055.

• FDIC Proposed Rules.

On March 20th, the FDIC published for comment two proposed rules. The first would implement Section 210(c)(16) of the Dodd-Frank Act, which permits the FDIC as receiver for a failed systemically important financial institution to enforce and prevent termination of the contracts of the institution's subsidiaries or affiliates. The second would make limited clarifications and definitional changes to the deposit insurance assessment system for insured depository institutions with more than $10 billion of assets. The proposed rule would fine tune the large-bank assessment system by amending the definitions of leveraged loans and subprime loans used to identify concentrations in higher-risk assets. Comments on either proposal should be submitted within 60 days after publication in the Federal Register, which is expected during the week of March 26. FDIC Press Release.

• Federal Reserve Board's Consumer Mobile Banking Survey Results.

On March 14th, the Federal Reserve Board published the results of its survey concerning consumer use of mobile banking. The Board found that approximately 20 percent of consumers used their mobile phone to access financial account and credit card information in the year ending January 2012, and that an additional 20 percent indicated they were likely to do so in the future. Federal Reserve Board Press Release.

• Federal Reserve Board Chairman Promises Clarity.

On March 14th, Federal Reserve Board Chairman Ben Bernanke told community banks that the Board intends to provide more explicit guidance on what regulations will apply to them. That greater specificity will be included in rules promulgated in response to the Dodd-Frank Act. Bernanke Remarks.

• Federal Reserve Board Tweets.

On March 14th, the Federal Reserve Board announced it has launched its own Twitter channel. Federal Reserve Board Press Release.

• Federal Reserve Board Releases Stress Test Results.

On March 13th, the Federal Reserve Board announced summary results of the latest round of bank stress tests, which show that the majority of the largest U.S. banks would continue to meet supervisory expectations for capital adequacy despite large projected losses in an extremely adverse hypothetical economic scenario. Federal Reserve Board Press Release. Reuters summarized the tests results.

• OCC Directors Workshops.

The OCC will host workshops for directors of nationally chartered community banks and federal savings associations in Birmingham, Alabama on April 17-18, 2012. The workshops cover risk assessment ("Directors: Where is the Risk in Your Bank") on April 17, and compliance risk ("Compliance Risk: What Directors Need to Know") on April 18. Workshops will also be held April 24-25, 2012 in Corpus Christi, Texas. The workshops cover risk assessment ("Directors: Where is the Risk in Your Institution?") on April 24, and credit risk ("Credit Risk: A Director's Focus") on April 25. OCC Alabama Workshops Press Release; OCC Texas Workshops Press Release.

• OCC Issues Quarterly Report on Bank Trading and Derivatives Activities.

On March 20th, the OCC issued its Quarterly Report on Bank Trading and Derivatives Activities. Commercial banks reported trading revenue of $2.5 billion in the fourth quarter of 2011, 70 percent lower than revised third quarter revenues of $8.5 billion, and 27 percent lower than in the fourth quarter of 2010. OCC Press Release.

• OCC Cost of Funds.

On March 15th, the OCC issued the final Cost of Funds reports (current and historical), which provide information about funding costs covering the six-month period ending December 31, 2011, for institutions formerly regulated by the Office of Thrift Supervision (OTS). OCC Press Release.

• Treasury Department Establishes Financial Research Advisory Committee.

On March 22nd, the Treasury Department announced that it is establishing the Financial Research Advisory Committee, which will make recommendations to the Office of Financial Research ("OFR"). The OFR was established by the Dodd-Frank Act to support the Financial Stability Oversight Council's duties to collect data, perform applied research, and develop tools for risk measurement and monitoring. Treasury Department Press Release.

• Ask CFPB.

On March 22nd, the Consumer Financial Protection Bureau launched an online tool to assist consumers in obtaining answers to their financial questions. CFPB Press Release.

• FDCPA Report.

On March 20th, the Consumer Financial Protection Bureau submitted its first annual report summarizing its administration of the Fair Debt Collection Practices Act.

• CFPB Extends Comment Reply Period for Suggested Regulatory Streamlining.

On March 13th, the Consumer Financial Protection Period extended to June 4, 2012 the period in which comments may be submitted in response to its request for suggestions on how it can streamline inherited regulations. 77 FR 14700. See also Streamlining Inherited Regulations (December 5, 2011 notice and request for comments).

• CFPB Proposes Confidentiality Rule.

On March 12th, the Consumer Financial Protection Bureau ("CFPB") published for comment a proposed rule that would codify protections for privileged information submitted to the CFPB by the financial institutions it regulates. Comments should be submitted on or before April 16, 2012. CFPB Press Release.

• FinCEN Guidance on Currency Transaction Report Aggregation.

On March 16th, the Financial Crimes Enforcement Network issued guidance to clarify, for currency transaction reporting purposes, the aggregation of multiple transactions conducted by businesses with common ownership. FinCEN Guidance.

• FinCEN Releases New Registration of Money Services Business Report Form.

On March 14th, the Financial Crimes Enforcement Network ("FinCEN") released the new Registration of Money Services Business, FinCEN Report 107, through the BSA E-Filing System. This report will fully replace the most recent FinCEN Form 107. The new report, which will be used by all money services businesses ("MSBs"), facilitates registration by foreign-located MSBs and providers of prepaid access. FinCEN Press Release.

• FinCEN's Strategic Plan.

On March 14th, the Financial Crimes Enforcement Network released its five-year strategic plan.

• Treasury Department Issues Iran Sanctions Interpretive Guidance.

On March 20th, the Treasury Department's Office of Foreign Asset Control published interpretive guidance aimed at assisting the licensing of exports to Iran that would directly benefit Iranian individuals and their access to information. Treasury Department Press Release.

• Unblocking Notices.

On March 12th, the Treasury Department's Office of Foreign Assets Control published the names of 18 individuals whose property and interests in property have been unblocked pursuant to Executive Order 12978 of October 21, 1995, "Blocking Assets and Prohibiting Transactions with Significant Narcotics Traffickers." 77 FR 14593.

• Comment Period Extended for Proposed Stress Test Rules.

On March 21st, the FDIC and OCC extended to April 30, 2012, the period in which comments may be submitted on their respective proposed rules implementing the Dodd-Frank Act's requirement that federal and state chartered banks and savings institutions with assets of $10 billion or more conduct annual stress tests. The FDIC's proposal applies to state nonmember banks and state savings associations supervised by the FDIC. The OCC's proposal applies to national banks and federal savings associations. 77 FR 16484. See also FDIC Press Release.

• Customer Clearing Documentation, Timing of Acceptance for Clearing, and Clearing Member Risk Management.

On March 22nd, the CFTC published the adopting release and text of new rules addressing the documentation between a customer and a futures commission merchant that clears on behalf of the customer; the timing of acceptance or rejection of trades for clearing by derivatives clearing organizations and clearing members; and the risk management procedures of futures commission merchants, swap dealers, and major swap participants that are clearing members. The rules are designed to increase customer access to clearing, to facilitate the timely processing of trades, and to strengthen risk management at the clearing member level. The rules are effective October 1, 2012. See also CFTC Fact Sheet; CFTC Questions and Answers.

• Technology Advisory Committee Meeting.

The CFTC's Technology Advisory Committee will hold a public meeting on March 29, 2012. The meeting will focus on automated and high frequency trading, final recommendations of the subcommittee on data standardization, and market structure and technology issues relating to credit limit checks. Comments concerning the meeting should be submitted on or before March 28, 2012. 77 FR 15737.

• CFTC Provides Conditional Relief for Large Trader Reporting.

On March 22nd, the CFTC's Division of Market Oversight issued a no-action letter to market participants providing temporary and conditional relief for less than fully compliant reporting under the CFTC's large trader reporting system for physical commodity swaps and swaptions. CFTC Press Release.

• ICE Clear Europe Requests Permission to Commingle Swaps and Futures Customers' Funds.

On March 20th, the CFTC requested comment on ICE Clear Europe's request for an order that would permit ICE Clear Europe and its clearing members that are registered futures commission merchants to commingle in an account subject to Section 4d(f) (a cleared swaps customer account) positions in swaps and foreign futures and options and related customer money, securities and property. Comments should be submitted on or before April 19, 2012. CFTC Press Release.

• CFTC Releases Annual CPO Guidance Letter.

On March 12th, the CFTC announced that the Division of Swap Dealer and Intermediary Oversight has issued its annual guidance letter to registered commodity pool operators ("CPOs"). The letter is intended to assist CPOs and their public accountants in complying with the CFTC's regulations on the preparation and filing of commodity pool financial reports, and to provide information regarding recent rule amendments. CFTC Press Release.

• CFTC Seeks Identifier Provider.

On March 9th, the CFTC requested submissions from industry participants who wish to be considered for designation by the CFTC as the source for identifiers to be used for identification of swap counterparties in swap recordkeeping and swap data reporting beginning on July 16, 2012. Submitters will be required to provide a written demonstration of their ability to meet all CFTC requirements by April 9, 2012, and to provide an on-site, live demonstration of their process for issuing identifiers before April 30, 2012. The Commission plans to designate the provider of identifiers shortly after May 29, 2012. CFTC Press Release.

• SEC Applies Policy Statement Concerning Cooperation by Individuals to Decline Enforcement Action.

On March 19th, the SEC issued a litigation release demonstrating the application of its Policy Statement Concerning Cooperation by Individuals in its Investigations and Related Enforcement Actions. The SEC credited the substantial cooperation of a former AXA Rosenberg senior executive during the agency's investigation into the nondisclosure of a coding error in the firm's quantitative investment process. AXA Rosenberg, Lit.Rel.No. 22298.

• Commissioner Walter Testifies about International Harmonization.

On March 22nd, SEC Commissioner Elisse B. Walter testified about the international harmonization of the Dodd-Frank Act's provisions concerning orderly liquidation, derivatives, and the prohibition against proprietary trading. Walter Testimony.

• Office of International Affairs Director Testifies on the Dodd-Frank Act's Indemnification Provision.

On March 21st, SEC Director of the Office of International Affairs, Ethiopis Tafara, testified in support of the repeal of Section 763(i) of the Dodd-Frank Act, which would require that any U.S. or foreign authority, other than the SEC, seeking to obtain security-based swap data from a SEC-registered security-based swap data repository agree to indemnify the security-based swap data repository and the SEC for any expenses arising from litigation relating to the information provided. Tafara Testimony.

• SEC Grants Section 11(d)(1) Exemptive Relief.

On March 20th, the SEC granted the application of Edward Jones & Co. LLP for an exemption under Section 36(a) of the Securities Exchange Act of 1934 from Section 11(d)(1) of the Exchange Act. The order exempts Edward Jones from the new issue lending restriction of Section 11(d)(1) of the Exchange Act to the extent that Edward Jones extends to a customer margin on newly-purchased shares of non-proprietary mutual funds in instances in which the customer makes a dollar-for-dollar substitution by selling an already-margined non-proprietary mutual fund and buying another non-proprietary mutual fund on margin without incurring any fees, commissions or other costs for the transactions, and without Edward Jones otherwise charging the respective customers any fees, commissions or other costs to effect the transactions. SEC Release No. 34-66624.

• SEC Issues Risk Alert and Investor Bulletin on Municipal Securities.

On March 19th, the SEC issued a Risk Alert on compliance measures to help broker-dealers fulfill their due-diligence duties when underwriting offerings of municipal securities. The agency also issued an Investor Bulletin to help educate investors about municipal bonds. The Office of Compliance Inspections and Examinations has noted that some broker-dealers are not focusing sufficient attention on the financial condition of some state and local governments before selling their securities to the public. The Investor Bulletin issued by the Office of Investor Education and Advocacy describes the attributes of municipal bonds, including investment risks, and provides information on where investors may obtain additional data on particular bonds. SEC Press Release.

• The Conflict over Conflict Minerals.

On March 19th, the New York Times discussed the SEC's efforts to implement the Dodd-Frank Act's conflict minerals provision, which requires firms to disclose in their annual reports whether they use certain minerals from the Democratic Republic of the Congo or an adjoining country. The Commission continues to debate as to who will be subject to the disclosure requirement. Conflict Minerals.

• SEC Makes CDS Market Analysis Available.

On March 15th, the SEC published the analysis of credit default swap market data conducted by the Division of Risk, Strategy, and Financial Innovation. The analysis was conducted as part of the SEC's and CFTC's effort to define the terms "swap dealer," "security-based swap dealer," "major swap participant," "major security-based swap participant," and "eligible contract participant." The information should help evaluate the impact of alternative approaches to implementing the de minimis exception to the "security-based swap dealer" definition by quantifying, under certain assumptions, the number of persons who may be required to register as "security-based swap dealers" or "major security-based swap participants," and to evaluating the security-based swap activities and positions of such persons. SEC Press Release.

• OCIE Ramps Up.

On March 15th, AdviserOne summarized the remarks of Carlo di Florio, SEC Director, Office of Compliance Inspections and Examinations. The article notes that the OCIE has hired 130 new examiners and discusses the Office's areas of focus. OCIE.

• Chairman Schapiro Discusses Open Issues.

On March 15th, SEC Chairman Mary L. Schapiro, in a speech before the Society of American Business Editors and Writers, summarized the Commission's regulatory efforts and commented on open issues. Schapiro warned against a House bill which would erode the protections put in place as a result of the research analyst conflicts of interest scandal. She also reiterated her commitment to mutual fund money market reforms. Schapiro Remarks. Reuters reported that three SEC Commissioners currently do not favor the suggested money market reforms. Response.

• OCIE Overview.

On March 13th, the Office of Compliance Inspections and Examinations released its February 2012 overview of the examinations it conducted. The overview discusses, among other things, notable cases, OCIE's risk-based approach, the inspection and examination process, and issues and priorities.

• Changes Regarding the Processing of Money Market Instruments are Proposed.

On March 20th, the SEC provided notice of The Depository Trust Company's filing of a proposed rule change amending DTC's Settlement Service Guide to change certain deadlines associated with processing issuances and maturity presentments of money market instruments. Comments should be submitted within 21 days after publication in the Federal Register, which is expected during the week of March 26. SEC Release No. 34-66630.

• FINRA Establishes GASB Accounting Support Fee.

On March 14th, the Financial Industry Regulatory Authority advised that in accordance with a SEC order, FINRA has established an accounting support fee, known as the GASB Accounting Support Fee, to adequately fund the annual budget of the Governmental Accounting Standards Board ("GASB"). For 2012, FINRA will assess and collect a total of $8,451,300 for the GASB Accounting Support Fee by collecting $2,112,825 from its member firms each calendar quarter. The GASB Accounting Support Fee will be collected quarterly from member firms that report trades to the Municipal Securities Rulemaking Board ("MSRB"). Each member firm's assessment will be based on the member firm's portion of the total par value of municipal securities transactions reported by FINRA member firms to the MSRB during the previous quarter. FINRA will send the first invoices for the GASB Accounting Support Fee in April. The first invoice will be based on trading activity during the first quarter of 2012. FINRA Regulatory Notice 12-15.

• FINRA Proposes Amendments Regarding Post-Trade Transparency for Agency Pass-Through Mortgage-Backed Securities Traded TBA.

On March 12th, the SEC provided notice of FINRA's filing of proposed amendments to the FINRA Rule 6700 Series and Trade Reporting and Compliance Engine ("TRACE") dissemination protocols regarding the reporting and dissemination of transactions in TRACE-Eligible Securities that are Agency Pass-Through Mortgage-Backed Securities that are traded to be announced ("TBA transactions"); to amend FINRA Rule 7730 regarding TRACE fees to provide for data fees for TBA transaction data; and to amend the FINRA Rule 6700 Series and FINRA Rule 7730 to delete references to a pilot program that expired on November 18, 2011, and to incorporate other minor administrative, technical or clarifying changes (relating to post-trade transparency for agency pass-through mortgage-backed securities traded TBA. Comments should be submitted on or before April 6, 2012. SEC Release No. 34-66577.

• Amendments to Arbitration Code Approved.

On March 12th, the SEC approved FINRA's proposed amendment of FINRA Rules 13201 (Statutory Employment Discrimination Claims) and 2263 (Arbitration Disclosure to Associated Persons Signing or Acknowledging Form U4) to align with statutes that invalidate predispute arbitration agreements for whistleblower disputes. SEC Release No. 34-66575.

• Changes to CDS Procedures Proposed.

On March 20th, the SEC provided notice of ICE Clear Europe's filing of proposed rule and CDS procedural amendments intended to modify the terms of the calculation and payment of interest on mark-to-market margin for CDS transactions. The amendments would provide further detail for calculation of interest on mark-to-market margin for CDS at the position level, but would not change the overall calculation of that interest. The amendments would also move payment of such interest from a monthly to a daily basis. Comments should be submitted within 21 days after publication in the Federal Register, which is expected during the week of March 26. SEC Release No. 34-66629.

• Amendments to Risk Modeling Proposed.

On March 20th, the SEC provided notice of ICE Clear Credit's filing of a proposed rule change amending its risk model to reduce the current level of risk mutualization among its clearing participants and to modify the initial margin risk model so that it is easier for market participants to measure their risk. Comments should be submitted within 21 days after publication in the Federal Register, which is expected during the week of March 26. SEC Release No. 34-66631.

• Amendments to Procedures for Executing the Stock Leg of Stock-Option Orders are Proposed.

On March 13th, the SEC provided notice of the International Securities Exchange's filing of proposed amendments to ISE Rule 722 (Complex Orders) to modify the procedures for executing the stock leg(s) of stock-option orders. The amendments would allow members to execute the stock legs of stock-option orders through a broker-dealer of their choosing. Comments should be submitted on or before April 9, 2012. SEC Release No. 34-66582.

• Changes Proposed to Rules for Broker's Brokers.

On March 20th, the SEC provided notice of the Municipal Securities Rulemaking Board's filing of proposed rule changes to the following: MSRB Rule G-43, which governs the municipal securities activities of broker's brokers and certain alternative trading systems; MSRB Rule G-8 (on recordkeeping by broker's brokers and certain alternative trading systems), MSRB Rule G-9 (on record retention), and MSRB Rule G-18 (on agency trades and trades by broker's brokers); and an interpretive notice on the duties of brokers, dealers, and municipal securities dealers that use the services of broker's brokers. Comments should be submitted within 21 days after publication in the Federal Register, which is expected during the week of March 26. SEC Release No. 34-66625.

• Increase in Examination Fees.

On March 20th, the National Futures Association announced that the Financial Industry Regulatory Authority, citing "cost increases due principally to higher charges from test delivery vendors and increased operational costs," has notified NFA that FINRA will increase its fees for the administration and delivery of NFA's qualifications exams on April 2, 2012. Effective April 2, 2012, the fee for an individual to take the Series 3 National Commodity Futures Examination will be $115. The fee for the Series 30 Branch Office Managers Exam - Futures, the Series 31 Futures Managed Funds Examination, the Series 32 Limited Futures Exam - Regulation, and the Series 34 Retail Off-Exchange Forex Examination will be $75. NFA Notice I-12-05.

• Futures Industry Committee Makes Customer Segregated Account Recommendations.

On March 12th, the National Futures Association announced that a special committee composed of representatives from the futures industry's self-regulatory organizations ("SRO") has proposed a series of initial recommendations for changes to SRO rules and regulatory practices designed to strengthen current safeguards for customer segregated and secured funds held at the firm level. The four recommendations include the following: requiring all futures commission merchants ("FCM") to file daily segregation and secured reports; requiring all FCMs to file Segregation Investment Detail Reports, reflecting how customer segregated and secured funds are invested and where those funds are held; performing more frequent periodic spot checks to monitor FCM compliance with segregation and secured requirements; and requiring a principal of the FCM to approve any disbursement of customer segregated and secured funds not made for the benefit of customers and that exceed 25% of the firm's excess segregated or secured funds. NFA Press Release. On March 23rd, Bloomberg reported CFTC Commissioner Bart Chilton said that the agency could vote on the NFA's proposal this summer. Vote.

• NYSE Euronext Fee Rate Advisory.

On March 14th, NYSE Euronext advised New York Stock Exchange and NYSE Amex members that the SEC has announced a mid-year adjustment to certain fees charged to registered broker-dealers and other market participants pursuant to the Securities Act of 1933 and the Securities Exchange Act of 1934. The changes take effect on April 1, 2012. NYSE Euronext Information Memo 12-7.

• NYBX Immediate-or-Cancel Order Approved.

On March 12th, the SEC approved the New York Stock Exchange's proposed establishment of a NYBX immediate-or-cancel order. SEC Release No. 34-66576.

• Arbitrators Determine Arbitrability.

On March 21st, the Eleventh Circuit vacated the district court's order denying defendant's motion to compel arbitration on plaintiffs' claim that defendant improperly charged their checking accounts overdraft fees. Whether plaintiffs' claims are subject to the service agreements' arbitration provision is a question for the arbitrator. The, matter, however, is first remanded to the trial court for a determination of whether the agreement is unconscionable under the Supreme Court's decision in AT&T Mobility LLC v. Concepcion, 131 S. Ct. 1740 (2011). If not unconscionable, an arbitrator must then determine arbitrability. In re: Checking Account Overdraft Litigation.

• Piercing of Corporate Veil is Affirmed.

On March 21st, the Seventh Circuit affirmed the trial court's order piercing the corporate veil to make a firm's shareholders liable to Wachovia for the firm's debt. The trial court's findings show defendants' utter abuse of the corporate form. The complete unity of interest and ownership between the firm and its owners paint a general disregard of the firm's separateness from its owners that opened a floodgate of fraud and injustice. Wachovia Securities, LLC v. Banco Panamericano, Inc.

• Acquisition Target Lacks Standing to Recover Proxy Expenses.

On March 21st, a federal district court held that Tenet, the target of Community Health's unsolicited takeover attempt, lacked standing under Section 14(a) of the Securities Exchange Act and Rule 14a-9 to sue Community Health for the costs Tenet incurred in analyzing and opposing Community Health's bid. Tenet Healthcare Corp. v. Community Health Systems, Inc.

• Morgan Stanley Entitled to Restitution for Losses Arising from Employee's Insider Trading Scheme.

On March 20th, a federal district court held that Morgan Stanley was a victim for purposes of the Mandatory Victims Restitution Act. After Morgan Stanley's former employee, defendant Joseph Skowron, pleaded guilty to insider trading, Morgan Stanley sought restitution for the losses it suffered as a result of Skowron's actions. The court held that Skowron's acts deprived Morgan Stanley of his honest services, diverted corporate time and energy, injured Morgan Stanley's reputation, and caused Morgan Stanley to incur legal expenses. The firm could therefore recover its legal fees and the compensation it paid to defendant as a result of the insider trading. However, Morgan Stanley could not recover money it paid to the SEC as disgorgement. U.S. v. Skowron.

• Dismissal of Ponzi Scheme Claims against JPMorgan is Affirmed.

On March 20th, the Ninth Circuit dismissed plaintiffs' claims arising out of Washington Mutual ("WaMu's") alleged provision of banking services to a known Ponzi scheme. Plaintiffs sued JPMorgan, as WaMu's successor, claiming that two WaMu employees knowingly assisted a Ponzi scheme. However, because JPMorgan acquired WaMu from the FDIC as the receiver of a failed bank, plaintiffs were required to exhaust their administrative remedies under the Financial Institutions Reform, Recovery, and Enforcement Act ("FIRREA") before suing. Plaintiffs' failure to do so barred the matter as it related to WaMu. While FIRREA does not apply to claims against JPMorgan for its own, post-acquisition independent actions, the Court held that plaintiffs' claims must be dismissed as conclusory. Benson v. JPMorgan Chase Bank, N.A.

• SLUSA Does Not Bar Stanford Ponzi Scheme Victims' State Law Claims.

On March 19th, the Fifth Circuit held that the Securities Litigation Uniform Standards Act ("SLUSA") does not preclude plaintiffs' state law claims stemming from R. Allen Stanford's Ponzi scheme. In doing so, the Court adopted the Ninth Circuit's standard for determining whether a misrepresentation is "in connection with" the purchase or sale of a security, which asks whether the allegations are more than tangentially related to transactions in covered securities. Applying that standard here, the Fifth Circuit found that the alleged scheme is only tangentially related to the purchase or sale of covered securities. Plaintiffs' claims, therefore, are not precluded by SLUSA. Roland v. Green.

• Second Circuit Schedules Oral Argument on SEC-Citigroup Settlement.

On March 19th, the Second Circuit issued a scheduling order in the SEC's and Citigroup Global Markets, Inc.'s appeal of U.S. District Court Judge Jed S. Rakoff's order denying their proposed settlement. Appellate brief must be submitted by May 14, 2012. The brief filed to uphold the order is due on August 13, 2012. The reply briefs are due on September 13, 2012. The appeal will be scheduled for oral argument on a date to be determined during the last two weeks of September 2012. Scheduling Order.

• Second Circuit Stays SEC-Citigroup Trial.

On March 15th, the Second Circuit agreed to hear on an interlocutory basis, the SEC's and Citigroup Global Markets Inc.'s appeal of the federal district court's order denying the parties' proposed settlement. The SEC alleges Citigroup inappropriately marketed collateralized debt obligations. Federal District Court Judge Jed Rakoff rejected the proposed settlement, questioning the SEC's policy of allowing respondents to settle without admitting liability. The Second Circuit granted the motion for interlocutory appeal based on the parties' showing of a likelihood of success on the merits. In doing so, however, it notes that the merits panel is free to resolve all issues without preclusive effect from the instant ruling. The Court denies the parties' motion for an expedited appeal and orders the appointment of counsel to represent the district court's view. SEC v. Citigroup Global Markets Inc.

• Investment Adviser Performance Compensation - Effective May 22, 2012.

The Securities and Exchange Commission ("SEC") is adopting amendments to the rule under the Investment Advisers Act of 1940 that permits investment advisers to charge performance based compensation to "qualified clients." The amendments revise the dollar amount thresholds of the rule's tests that are used to determine whether an individual or company is a qualified client. These rule amendments codify revisions that the SEC recently issued by order that adjust the dollar amount thresholds to account for the effects of inflation. 77 FR 10358.

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