The SEC announced that David Grim wills serve as the new Director of the Division of Investment Management. Mr. Grim has been the acting director of the Division of Investment Management since February 2015.

View the SEC press release.

The New York State Department of Financial Services announced that it has granted a charter under the New York Banking Law to itBit Trust Company, LLC – a commercial Bitcoin exchange based in New York City. The announcement establishes ItBit as the first virtual currency company to receive a charter from the NYDFS. This announcement caps a series of announcements from the NYDFS, outlining and establishing regulatory guidelines for virtual currencies. Most recently, in December 2014, the NYDFS released a framework for licensing virtual currency firms, known as the "Bitlicense framework." The BitLicense framework included consumer protection, anti-money laundering compliance and cyber security rules tailored for virtual currency firms, including the creation of a two-year transitional BitLicense to assist startups. The additional comment period for the revised BitLicense framework ended in March 2015 and NYDFS expects to put forward its final regulatory framework later this month.

View the press release.

The Federal Reserve Bank of New York announced the resignation of Sarah Dahlgren, executive vice president and head of the New York Fed’s Financial Institution Supervision Group. On October 1, 2015, Ms. Dahlgren will assume the role of senior advisor to the president of the New York Fed, Mr. William C. Dudley. Ms. Dahlgren is expected to remain in her current position as head of FISG until October 1, 2015, to assist with the transition.

View the press release.

The Prudential Regulation Authority published its third consultation paper on the PRA Rulebook, setting out proposals to amend or delete certain modules of the PRA Handbook and create a new PRA Rulebook. The aim of the review is to reshape materials inherited from the Financial Services Authority to create a Rulebook which contains PRA rules only and follows the split of the FSA into the PRA and the Financial Conduct Authority. This is intended to facilitate firms’ compliance with PRA rules and to provide access to more concise rules, resulting in a more comprehensive understanding of the PRA’s requirements. The consultation paper sets out suggested Rulebook parts including on: (i) the exercise of passport rights by UK firms; (ii) reverse stress-testing (which will be moved to the Internal Capital Adequacy Assessment part of the Rulebook); and (iii) integrated regulatory reporting. The consultation paper also includes draft supervisory statements on: (i) guidelines for completing regulatory reports; (ii) internal governance of third country branches; (iii) Internal Capital Adequacy Assessment Process and Supervisory Review and Evaluation Process; and (iv) internal governance. Responses to the consultation are due by June 30, 2015.

View the consultation paper.

Comptroller of the Currency Thomas J. Curry appointed Michael Brickman as Deputy Comptroller for Thrift Supervision. Mr. Brickman will also continue to serve as Deputy Comptroller for Special Supervision.

View the press release.

The European Securities and Markets Authority published a call for evidence on investment using virtual currency or distributed ledger technology. ESMA has been monitoring virtual currency investment to understand market developments, the potential benefits and risks for investors and potential issues for market integrity and financial stability. ESMA sets out its analysis in the paper and requests feedback on three particular topics: (i) virtual currency investment products, such as collective investment schemes or derivatives that have virtual currencies as an underlying or which invest in virtual currency businesses; (ii) virtual currency based assets, securities and asset transfers; and (iii) the application of distributed ledger technology to securities. ESMA is not proposing regulatory action at this stage but will continue to monitor investments using virtual currencies or distributed ledger technology to assist national regulators in keeping up to date with market developments. In July 2014, the European Banking Authority published an opinion proposing a potential regulatory regime for virtual currencies and advising national regulators to “discourage” financial institutions from buying, holding or selling them until a regulatory regime is in place.

View the call for evidence.

The Council of the EU approved a new directive and regulation aimed at strengthening rules against money laundering and terrorist financing. The new set of laws, when in effect, aim to bring the EU in line with approaches currently taken internationally, and follow the recommendations made by the Financial Action Task Force which is deemed to be a global reference for anti-money laundering and terrorist financing. The final text of the regulation and directive is yet to be published in the Official Journal of the European Union. Once published, member states will have two years to transpose the directive into national law. The regulation will be directly applicable in EU Member States without the need for any further transposition. The new laws will repeal the current European regulation and directive on anti-money laundering and terrorist financing.
 

View the proposed texts of the regulation and directive and press release.

The Financial Stability Board chair wrote a letter to the G20 Financial Ministers and Central Bank Governors on the FSB’s progress on the financial regulation agenda. The letter includes information on continuing work to finalize post-crisis reforms in two major areas: (i) ending too-big-to-fail for financial institutions; and (ii) emerging vulnerabilities, specifically, financial stability risks, especially those from asset managers, and misconduct risks and withdrawal from correspondent banking.

View the letter.

President Obama announced the nomination of the US Office of Foreign Assets Control’s Director, Adam Szubin, for the role of Undersecretary of the Treasury for Terrorism and Financial Crimes.

View the press release.

On April 16 and 17, 2015, the G20 Finance Ministers and Central Bank Governors held their second meeting under Turkish presidency in Washington, DC. Further to the meeting, a communiqué was published which detailed the conclusions of the group as well as its goals for the future. The G20 stated, amongst other things, that (i) the commitment remains to finalize the total loss absorbing capacity standard for global financial institutions by November 2015; (ii) gaps in the recovery and resolution of CCPs will be identified and addressed; (iii) the G20 roadmap for the regulation of shadow banking is being implemented; and (iv) that cross-border cooperation will be enhanced to ensure more effective regulations, particularly for resolution and OTC derivative market reforms. The G20 Finance Ministers and Central Bank Governors will meet again in September 2015. The next G20 summit is in November 2015.
 

View the communiqué.

The US Office of the Comptroller of the Currency issued the “Real Estate Settlement Procedures Act” booklet of the Comptroller’s Handbook. The revised booklet replaces a similar booklet issued in October 2011 and provides updated information resulting from recent changes in Regulation X (12 CFR 1024) related to mortgage servicing and loss mitigation. Additionally, on April 15, 2015, the OCC issued the “Trade Finance and Services” booklet of the Comptroller’s Handbook. The revised booklet replaces the “Trade Finance” and “Bankers’ Acceptances” booklets issued in November 1998 and September 1999, respectively.
 

View the OCC press release.
View the "Trade Finance and Services" booklet.
View the OCC bulletin for the "Real Estate Settlement Procedures Act" booklet.

The OCC named Maryann H. Kennedy and Kris A. McIntire Deputy Comptrollers for Large Bank Supervision. In this role, Ms. Kennedy and Mr. McIntire will oversee the supervision of a portion of the OCC’s large bank portfolio.

Richard Taft was named as Deputy Comptroller for Credit Risk at the OCC, starting in May. As a principal advisor on credit risks facing the banking system, he will oversee the Commercial and Retail Credit Policy units.

The European Securities and Markets Authority announced the launch of two centalized data projects relating to obligations under the European Market Infrastructure Regulation, the Markets in Financial Instruments Regulation and the Market Abuse Regulation. The projects are:

• The Instrument Reference Data Project which will provide a central facility for instrument and trading data and the calculation of transparency and liquidity thresholds. This facility is expected to go live in early 2017.
• The Trade Repositories Project which will provide a single access point to trade repository data under EMIR. This data facility is expected to go live in 2016.

ESMA has agreed to develop the centralized data solutions following requests from EU national regulators. The projects will allow ESMA to collect data directly from trading venues and trade repositories and make that data publicly available through a centralized system.
 

View ESMA’s announcement.

The Bank of England announced that non-executive Prudential Regulation Authority board member, Iain Cornish, would be stepping down with immediate effect.

A revised Global Preamble: Codes of Best Practice and Shared Global Principles was published by eight FX committees which sit in the major financial centres — Australia, Canada, Frankfurt, Hong Kong, London, New York, Singapore and Tokyo. FX market participants are expected to incorporate the guidance into their FX policies in a timely manner. The Global Preamble, last revised in 2013, covers standards of personal conduct, execution and dealing practices, confidentiality and market conduct.

View the revised Global Preamble.

The Federal Reserve Bank of New York appointed Michael Strine first Vice President, effective July 1, 2015. The appointment was approved by the Federal Reserve Board.

The SEC adopted final rules to allow smaller companies better access to capital and provide investors with more investment choices. The new rules update and expand Regulation A, an existing exemption from registration for smaller issuers of securities and will enable smaller companies to offer and sell up to $50 million of securities in a 12-month period, subject to eligibility, disclosure and reporting requirements. The rules are mandated by Title IV of the Jumpstart Our Business Startups Act and will attempt to provide investors with more investment choices, especially among smaller companies. The rules will be effective 60 days after publication in the Federal Register.

View the Final Rules.

The Financial Conduct Authority published its business plan for 2015/2016 which indicates upcoming focus areas for the regulator and announces upcoming priorities. Key issues include: (i) conflicts of interest in dark pools; (ii) investor charges in asset management; (iii) the wholesale market study into competition in investment and corporate banking; (iv) poor culture and controls which threaten market integrity; and (v) systems and controls for financial crime.
 

View the FCA business plan.

HM Treasury and the Financial Conduct Authority issued a joint consultation on the Implementation of the Transparency Amending Directive that entered into force on November 26, 2013 and which amends the Transparency Directive, the Transparency Directive Implementing Directive and the Prospectus Directive. The directives aim to harmonize the information disclosure requirements of companies, and the consultation sets out the proposed amendments to be implemented by HM Treasury to the Financial Services and Markets Act and by the FCA to the FCA’s Disclosure and Transparency Rules, including: (i) the extension of the deadline to publish half-yearly reports and the period of time for which financial reports are publicly available; and (ii) changes to the definition of an issuer. The Transparency Amending Directive must be implemented by EU Member States before November 26, 2015. Comments on the consultation may be submitted until May 20, 2015.

View the consultation paper

The Department for Business Innovation & Skills published guidance for employers and prescribed persons regarding whistleblowing. The documents lay out various policies and procedures for employers regarding whistleblowing. A prescribed person is an organization or individual that a worker may approach outside their workplace to report suspected or known wrongdoing. The Prescribed Persons Order 2014 sets out a list of over 60 such organizations and individuals that have been designated as prescribed persons because they have an authoritative or oversight relationship with the sector, often as a regulatory body.

View the guidance for employers and the code of practice

View the guidance for prescribed persons

HM Treasury published a report detailing the outcome of its consultation on the criteria for the designation of payments for oversight by the Payment Systems Regulator. HM Treasury is responsible for designating the payment systems that will be subject to regulation and proposals in its consultation suggested the designation of seven payment systems: Bacs, CHAPS, Faster Payment Service, LINK, Cheque and Credit Clearing, Northern Ireland Cheque Clearing, MasterCard and Visa. HM Treasury confirms in its outcome report that only those seven payment systems will be subject to regulation at this stage.

View the report

The European Securities and Markets Authority published a report reviewing how national regulators across the EU have implemented its guidelines on automated trading. The guidelines aim to increase levels of supervision on automated trading activities. ESMA’s review found that the majority of EU national regulators have integrated the guidelines into their supervisory practices. However, the report also identified areas for improvement such as the need for regulators to: (i) increase their IT expertise; (ii) allow sufficient resources to be available so that proper supervision can take place; and (iii) coordinate between themselves so that ring fencing programs can be set up to prevent cyber-attacks.

View the report

HM Treasury published a report detailing the outcome to its call for evidence on the benefits of open data and data sharing in banking. The report specifies the actions that will be taken by the government to deliver an open standard for APIs. APIs will allow different pieces of software to interact with each other, making it easier for customers or fintech companies on behalf of customers to determine if customers can, for example, get a better deal with a different bank elsewhere. The report states that the government aims to set out a detailed framework for an open API standard by the end of 2015.

View the report

The Agency for the Cooperation of Energy Regulators published the European register of market participants on its designated portal together with its list of standard contracts and the fourth edition of ACER’s Q&As on the Regulation on Energy Market Integrity and Transparency. This is further to ACER finalizing its preparatory work on supporting documentation under REMIT, the EU Regulation that aims to prevent market manipulation and trading on inside information in the wholesale energy market, and more generally improves integrity in this market. On March 20, 2015, ACER also published a recommendation to the European Commission on wholesale energy derivative contracts that must be physically settled under Markets in Financial Instruments Directive II. ACER’s recommendation states that wholesale energy products that must be physically settled and that are in the scope of REMIT include futures, options on futures, options on swaps and any other type of derivative that must be physically settled. ACER also proposes, amongst other recommendations, that the Commission clarifies in its delegated acts that a wholesale energy derivative contract traded on an Organized Trading Facility must be physically settled if it cannot be settled in cash.

View the ACER’s designated REMIT portal, Q&As and recommendation.
 

HM Treasury published the Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2015 together with a corresponding explanatory memorandum. The Order amends the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001 to create a new type of regulated activity of advising on the conversion or transfer of pension benefits which are safeguarded benefits. Safeguarded benefits are defined to mean any benefits other than money purchase benefits and cash balance benefits. This means that the activity cannot generally be carried on in the UK except by an authorised person or pursuant to an exemption. Concurrently, HM Treasury published the Financial Services and Markets Act 2000 (Regulated Activities) (Transitional Provisions) Order 2015, which makes transitional provision in connection with this new regulated activity. This instrument provides that advisors previously permitted to advise on an equivalent class of transfer are automatically authorised to advise under the new activity. Both Orders enter into force on April 6, 2015.

View the Orders and explanatory memoranda

View the Orders and explanatory memoranda 2

View the Orders and explanatory memoranda 3

View the Orders and explanatory memoranda 4

The FCA published an updated timetable relating to the implementation of the Markets in Financial Instruments Directive II and Markets in Financial Instruments Regulation. The timetable sets out the key dates for the implementation and transposition of the Directive and Regulation into domestic law. The deadline for transposing MiFID II into domestic law is July 3, 2016. MiFID II and MiFIR enter into force on January 3, 2017. The FCA aims to publish its main consultation paper on the implementation of MIFID II and MIFIR in December 2015. The final rules are to be published in June 2016.

View the FCA’s timetable

The European Banking Authority published its opinion on lending-based crowdfunding, recommending that the applicability of existing EU law to the activity be clarified. The EBA considers that such clarification is necessary to avoid regulatory arbitrage across the EU and to ensure a level playing field as EU Member States have adopted different approaches to regulating lending-based crowdfunding. The opinion is addressed to the European Commission, the European Parliament and the EU Council.

View the EBA opinion

The European Securities and Markets Authority published the results of its peer review of supervision and enforcement of the best execution provisions in the Market in Financial Instruments Directive by national regulators. Investment firms are required to provide best execution for their clients when executing their client’s orders. ESMA’s review found that implementation of the best execution provisions in MiFID I varied across the EU. To address the issue, ESMA recommends several improvements, including: (i) prioritization of best execution by national regulators; (ii) the allocation of supervisory resources; and (iii) the adoption of a proactive approach to monitoring compliance with best execution requirements, including through onsite inspections. ESMA intends to work with national regulators to give effect to the recommendations.

View the peer review

The Federal Reserve Board, the Federal Deposit Insurance Corporation, the National Credit Union Administration, and the Office of the Comptroller of the Currency, as members of the Financial Literacy and Education Commission (“FLEC”), together with the Financial Crimes Enforcement Network for the US Department of the Treasury, jointly issued guidance to encourage federally insured depository institutions to offer youth savings programs to develop the financial aptitude of young people. The guidance also provides answers to frequently asked questions related to the establishment of these programs. The guidance does not create any new regulatory policy or establish new industry expectations. This effort is consistent with the “Starting Early for Financial Success” focus of the FLEC. Congress created FLEC in 2003 to improve financial capability and education in the United States.

View the guidance

Luc Coene, currently Governor of the Nationale Bank van België, has been appointed as one of four European Central Bank representatives to the Supervisory Board of the Single Supervisory Mechanism. The other ECB representatives are Sirkka Hämäläinen, Julie Dickson and Ignazio Angeloni.

Sandra C. Krieger, executive vice president of the Risk Group and chief risk officer of the Federal Reserve Bank of New York, announced her intention to retire from the bank in the second quarter of 2015.

View the notice.

The US Commodity Futures Trading Commission announced the members of the CFTC’s Market Risk Advisory Committee. MRAC, first chartered in 2014, is intended to support the CFTC’s efforts to identify and mitigate risks within the market to industry participants, consumers and the broader financial community.

View the full list of MRAC members.

The European Commission published a green paper on building a Capital Markets Union. This was published alongside two complementary consultation papers on: (i) a EU framework for simple, transparent and standardized securitization; and (ii) the review of the Prospectus Directive. These publications form part of a wider initiative to develop a single market for capital across the EU. The green paper consults on the establishment of the CMU, which aims to lower the costs of funding within the EU and increase sources of funding for businesses. The paper identifies five priority areas for early action: (i) reducing barriers to accessing capital markets; (ii) widening the investor base to small and medium-sized enterprises; (iii) building sustainable securitization; (iv) boosting long-term investment; and (v) developing European private placement markets. The Prospectus Directive consultation seeks views on making it easier for companies to raise capital throughout the EU whilst effective investor protection is maintained and information to be included in prospectuses is simplified. The consultation on the EU framework for simple, transparent and standardized securitizations aims to increase high-quality securitization, through higher standards of process, legal certainty and comparability across securitization. The green paper and two consultations close for comments on May 13, 2015.

View the Green Paper.

View the Prospectus Directive consultation.

View the consultation on the EU framework for simple, transparent and standardized securitization.

The G20 Finance Ministers and Central Bank Governors issued a draft communiqué which was adopted in a meeting at the Turkish G20 Presidency on February 9-10, 2015. The communiqué highlighted the risk of prolonged low inflation, slow growth, and demand weakness in some advanced economies. G20 members will keep fiscal policy flexible to reflect near-term economic realities.

Additionally on February 10, 2015, the Chairman of the Financial Stability Board published a letter to the G20 Finance Ministers and Central Bank Governors titled, Financial Reforms – Finishing the Post-Crisis Agenda and Moving Forward. This letter sets out the FSB’s priorities in the next phase of reform which include: consistent and prompt implementation of agreed reforms, finalizing the design of remaining post-crisis reforms and addressing new risks and vulnerabilities.

The FSB plans to publish its first annual report on the implementation of agreed reforms and their effects this year. In addition, implementation will be supported through peer reviews which will cover: implementation of the G20 policy framework for ‘other shadow banking entities’, effective supervisory frameworks for global systemically important banks; bank resolution powers and recovery and resolution planning requirements and the effectiveness of reporting of OTC derivatives transactions to trade repositories. Additionally, the FSB will focus efforts to address two explicit emerging vulnerabilities: market-based finance and misconduct.

View The Communiqué.

View the FSB Chairman's Letter.

The Joint Forum (made up of the Basel Committee on Banking Supervision, the International Organization of Securities Commissions and the International Association of Insurance Supervisors) launched a consultation on developments in credit risk management across the banking, securities and insurance sectors. The consultation document includes an analysis of responses to a survey conducted in 2013 which included supervisors and firms on credit risk management and four recommendations to supervisors: (i) supervisors should be cautious against over-reliance on internal models for credit risk management and regulatory capital; (ii) supervisors should be aware of the growth of risk-taking behaviors, for example, in the syndicated leveraged loan market, and the need for firms to have appropriate risk management processes; (iii) supervisors should be aware of the growing need for high-quality liquid collateral for margin requirements in derivatives trading; and (iv) supervisors should consider whether firms are accurately capturing CCP exposures as part of their credit risk management. Comments on the paper are requested by March 4, 2015.

View the Joint Forum consultation paper.

The European Securities and Markets Authority published its final technical advice on delegated acts under the new Market Abuse Regulation. The European Commission requested the advice from ESMA to assist it in developing the required Delegated Acts under MAR. ESMA’s advice covers: (i) clarification of the indicators of market manipulation; (ii) minimum thresholds for the exemption of certain participants in the emission allowance market from the requirement to publicly disclose inside information; (iii) ways for determining the relevant national regulator for notification of delays in public disclosure of inside information; (iv) clarification on the enhanced disclosure regime for managers’ transactions; and (v) reporting of
infringements. The European Commission must adopt Delegated Acts on these issues so that they enter into force 24 months after MAR entered into force, which was on July 2, 2014.

View ESMA advice.

The UK Financial Conduct Authority published its review of the regulatory regime for crowdfunding. The document sets out the FCA’s approach to regulating loan-based and investment-based crowdfunding platforms, including the new rules introduced in March 2014. The FCA does not, at this stage, intend to amend its rules or approach to supervision of the market but will undertake a full review of the crowdfunding market and regulatory framework in 2016.

View the FCA review document.

The SEC named David Grim as Acting Director of the Division of Investment Management, replacing Norm Champ.

The Prudential Regulation Authority published a consultation paper proposing transitional provisions and new rules to the PRA Rulebook, and amendments to the PRA Handbook arising out of rules previously proposed in the Depositor Protection and Policyholder Protection consultation papers published by the PRA in October 2014. The measures proposed under the consultations aim to minimize any possible adverse impact that could be caused to UK financial stability through the failure of a PRA-deposit taker, dormant account fund operator or PRA-authorized insurer. It also aims to ensure an effective compensation system to eligible depositors, dormant account holders and policyholders. The consultation includes new rules on compensation arrangements related to dormant account protection as well as a statement of policy on the PRA's expectations of the Financial Services Compensation Scheme when dealing with dormant accounts. The consultation period ends on February 27, 2015.

View the consultation paper.

Robert E. Rice, Chief Counsel to the US Securities and Exchange Commission (“SEC”) Chair Mary Jo White, announced he will leave the SEC at the end of February.

The European Commission stated in a press release that it had launched plans to establish a Capital Markets Union by holding an orientation debate at the College of Commissioners. The establishment of the single market for all 28 EU member states will aim to lower the costs of funding within the EU, remove barriers to cross-border investment and increase sources of funding for businesses. In a separate press release dated January 30, 2015, the European Commission stated that a consultation on the CMU will be launched on February 18, 2015, and that a plan of action will be released during the third quarter of 2015.

View the press release.

View the other press release.

Erin Schneider was named Associate Regional Director in the San Francisco Office of the SEC.

The Bank of England announced the appointment of two new directors to its executive team. Alex Brazier is appointed as Executive Director for Financial Stability, Strategy and Risk from March 16, 2015 and will also be a member of the Financial Policy Committee from April 1, 2015. Sam Wood is appointed as Executive Director for Insurance Supervision from April 7, 2015.

Michael Brickman was named Deputy Comptroller for Special Supervision at the Office of the Comptroller of the Currency.

The Federal Reserve Bank of New York announced the appointment to its Community Depository Institutions Advisory Council of Martin K. Birmingham, president and chief executive officer of Five Star Bank and Financial Services Inc. in Warsaw, New York.

The CFPB announced the addition of several new members to leadership positions.

• Anthony Alexis will serve as the CFPB’s Assistant Director of Enforcement.
• Leandra English is returning to the CFPB to serve as the Deputy Chief Operating Officer.
• Agnes Bundy Scanlan is joining the CFPB to serve as the Northeast Regional Director of Supervision Examinations.
• Jeffrey Sumberg is joining the CFPB to serve as the Chief Human Capital Officer.