SEC, CFTC Staffs to Host Joint Public Roundtable to Discuss Issues Related to Clearing of Credit Default Swaps
The Securities and Exchange Commission and Commodity Futures Trading Commission staffs will hold a public roundtable on October 22 from 9 a.m. to noon to discuss issues related to the clearing of credit default swaps.
The roundtable will assist both agencies in the rulemaking process to implement the Dodd-Frank Wall Street Reform and Consumer Protection Act.
The roundtable will be held in the Lobby Level Hearing Room at the CFTC's Headquarters, Three Lafayette Centre, 1155 21st Street NW, Washington D.C. The discussion will be open to the public with seating on a first-come, first-served basis. Members of the public may also listen by telephone and should be prepared to provide their first name, last name and affiliation.
A transcript of the public roundtable discussion will be published on the CFTC's website at http://www.cftc.gov/LawRegulation/DoddFrankAct/OTC_7_DCORules.html.
Members of the public wishing to submit their views on the topics addressed at the roundtable may e-mail their submissions to:
CFTC — DCORules@cftc.gov (all e-mails must reference "Dodd-Frank CDS Roundtable" in the subject field).
All submissions provided to either the CFTC or the SEC in any electronic form or on paper will be published on the website of the respective agency, without review and without removal of personally identifying information.
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Agenda for the Joint CFTC-SEC Public Roundtable Discussion
(Press Rel. 2010-196)
In the Matter of Team America, Inc., et al.
On October 15, an Administrative Law Judge issued an Order Making Findings and Revoking Registrations by Default as to Seven Respondents in Team America, Inc., Administrative Proceeding No. 3-14035. The Order Instituting Proceedings (OIP) alleged that eight Respondents repeatedly failed to file required annual and quarterly reports while their securities were registered with the Securities and Exchange Commission. The Default Order finds these allegations to be true as to seven Respondents and revokes the registrations of each class of registered securities of Team America, Inc., Teldar Financial, Inc. (n/k/a Harlem Business Development Corp.), Telecomm Industries Corp., TeleHubLink Corp., Terra Firma Technologies, Inc., thatlook.com, Inc., and THC Communications, Inc., pursuant to Section 12(j) of the Securities Exchange Act of 1934.
The Commission previously accepted an Offer of Settlement from Texon Energy Corp., the other Respondent named in the OIP. See Team Am., Inc., Rel. 34-63079, Oct. 13, 2010. (Rel. 34-63111; File No. 3-14035)
In the Matter of Gregory C. Gunn
On October 15, the United States Securities and Exchange Commission issued an Order Instituting Administrative Proceedings Pursuant to Section 15(b) of the Securities Exchange Act of 1934 against Gregory C. Gunn.
In the Order the Commission finds that on September 8, 2010, the United States District Court for the Northern District of Texas entered a final judgment permanently enjoining Gregory C. Gunn from future violations of Section 10(b) of the Exchange Act and Rule 10b-5 thereunder. In addition to injunctive relief, the court ordered Gunn to pay disgorgement $108,587.87, plus prejudgment interest thereon in the amount of $31,195.10, and a civil penalty in the amount of $50,000.
The Commission's complaint alleged that Gunn, while in possession of material, non-public information engaged in illegal insider trading in the securities of Aviall, Inc. The complaint further alleged that a warehouse employee acquired material, non-public information about the acquisition of Aviall by the Boeing Corporation and tipped Gunn's brother with the information, who subsequently tipped the information to Gunn. While in possession of this information, Gunn liquidated his entire portfolio of "blue chip" securities and used the proceeds to purchase $110,487.16 of Aviall securities, consisting of $75,512.97 of Aviall common stock and $34,974.19 of Aviall call options, between April 17, 2006, and April 28, 2006. On May 1, 2006, Boeing publicly announced the impending acquisition of Aviall and on the same day Gunn liquidated all of his Aviall holdings and realized profits of $108,587.87.
Based on the above, the Order bars Gunn from association with any broker or dealer. The right to reapply for association by the Respondent will be subject to the applicable laws and regulations governing the reentry process, and reentry may be conditioned upon a number of factors, including, but not limited to, the satisfaction of any or all of the following: (a) any disgorgement ordered against the Respondent, whether or not the Commission has fully or partially waived payment of such disgorgement; (b) any arbitration award related to the conduct that served as the basis for the Commission order; (c) any self-regulatory organization arbitration award to a customer, whether or not related to the conduct that served as the basis for the Commission order; and (d) any restitution order by a self-regulatory organization, whether or not related to the conduct that served as the basis for the Commission order. Gunn consented to the issuance of the Order without admitting or denying the findings in the Order. See SEC v. Gregory C. Gunn, Civil Action Number 3:08-CV-1013-G, N.D. Tex.; LR-21286 and LR-20623. (Rel. 34-63114; File No. 3-14089)
In the Matter of George Wesley Harris
On October 15, the Commission announced the issuance of an Order Instituting Administrative Proceedings Pursuant to Section 15(b) of the Securities Exchange Act of 1934 and Notice of Hearing against George Wesley Harris, a resident of Mansfield, Texas, based on the entry of a permanent injunction against him in the civil action entitled Securities and Exchange Commission v. Giant Operating, LLC, et al., Civil Action No. 3:09-cv-1809-B in the United States District Court for the Northern District of Texas, Dallas Division.
In the Order, the Division of Enforcement alleges that, on Sept. 21, 2010, a final judgment was entered against Harris in the civil action, permanently enjoining him from future violations of Sections 5(a), 5(c), and 17(a) of the Securities Act of 1933 and Sections 10(b) and 15(a) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. The Division of Enforcement further alleges in the Order that the Commission's complaint in the civil action alleged, among other things, that Harris and others engaged in fraudulent securities offerings, which were not registered with the Commission as required under the law, through which Giant Operating, LLC raised at least $16.6 million from at least 150 investors throughout the United States.
A hearing will be scheduled before an Administrative Law Judge to determine whether the allegations contained in the Order are true, to provide Harris an opportunity to dispute the allegations, and to determine what, if any, remedial action is appropriate and in the public interest, pursuant to Section 15(b) of the Securities Exchange Act of 1934.
The Order directed that an Administrative Law Judge shall issue an initial decision no later than 210 days from the date of service of the Order, pursuant to Rule 360(a)(2) of the Commission's Rules of Practice. (Rel. 34-63115; File No. 3-14090)
Immediate Effectiveness of Proposed Rule Changes
A proposed rule change filed by BATS Y-Exchange, Inc. (SR-BYX-2010-002) to amend BATS Y-Exchange, Inc. rules to conform to the current rules of BATS Exchange has become effective under Section 19(b)(3)(A) of the Securities Exchange Act of 1934. Publication of the proposal is expected in the Federal Register during the week of October 18. (Rel. 34-63097)
A proposed rule change filed by The NASDAQ Stock Market LLC regarding fees for the Clearly Erroneous Module (SR-NASDAQ-2010-130) has become effective pursuant to Section 19(b)(3)(A) of the Securities Exchange Act of 1934. Publication of the proposal is expected in the Federal Register during the week of October 18. (Rel. 34-63101)
Proposed Rule Changes
The Commission issued a notice of filing of a proposed rule change by the Municipal Securities Rulemaking Board (MSRB) pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934, consisting of amendments to Rule A-13 to increase transaction assessments for certain municipal securities transactions reported to the Board and to institute a new technology fee on reported sales transactions (SR-MSRB-2010-10). Publication is expected in the Federal Register during the week of October 18. (Rel. 34-63095)
Approval of Proposed Rule Changes
The Commission approved a proposed rule change (SR-CBOE-2010-077), submitted by the Chicago Board Options Exchange, Incorporated pursuant to Rule 19b-4 under the Securities Exchange Act of 1934, to permit the Exchange to list series with up to 12 expiration months for broad-based security index options upon which the Exchange calculates a volatility index. Publication is expected in the Federal Register during the week of October 18. (Rel. 34-63096)
The Commission approved a proposed rule change submitted under Section 19(b)(1) of the Securities Exchange Act of 1934 by the International Securities Exchange LLC (SR-ISE-2010-91) to adopt a pilot program to list additional expiration months for each class of options opened for trading on the exchange. Publication of the proposal is expected in the Federal Register during the week of October 18. (Rel. 34-63104)
Pursuant to Section 19(d)(1) of the Securities Exchange Act of 1934 and Rule 19d-1(c)(2) thereunder, the Commission has approved the Minor Rule Violation Plan filed by BATS Y-Exchange, Inc. (File No. 4-616). Publication is expected in the Federal Register during the week of October 18. (Rel. 34-63113)
Designation of Longer Period for Commission Action on Proposed Rule
The Commission has designated a longer period for Commission action under Section 19(b)(2) of the Securities Exchange Act of 1934 on a proposed rule change (SR-BX-2010-059) filed by NASDAQ OMX BX, Inc. to create a listing market. Publication is expected in the Federal Register during the week of October 18. (Rel. 34-63105)
Joint Industry Plans
The Commission approved and declared effective a proposed plan between the Financial Industry Regulatory Authority, Inc. and BATS-Y Exchange, Inc. for the allocation of regulatory responsibilities pursuant to Rule 17d-2 (File No. 4-613). Publication of the proposal is expected in the Federal Register during the week of October 18. (Rel. 34-63102)
The Commission noticed, approved, and declared effective a proposed plan for the allocation of regulatory responsibilities relating to the surveillance, investigation, and enforcement of insider trading rules pursuant to Rule 17d-2 under the Securities Exchange Act of 1934 (File No. 4-566). Publication of the notice and order is expected to be made in the Federal Register during the week of October 18. (Rel. 34-63103)
The Options Price Reporting Authority filed with the Securities and Exchange Commission a notice of filing and immediate effectiveness of a proposed amendment pursuant to Section 11A of the Securities Exchange Act of 1934 and Rule 608 thereunder (SR-OPRA-2010-01) to revise the Plan for Reporting of Consolidated Options Last Sale Reports and Quotation Information to serve as the operating agreement for OPRA LLC. Publication is expected in the Federal Register during the week of October 18. (Rel. 34-63106)
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