SEC News Digest

COMMISSION ANNOUNCEMENTS

SEC, Quebec Autorite Des Marches Financiers and Ontario Securities Commission Sign Regulatory Cooperation Arrangement

On June 14, 2010, the U.S. Securities and Exchange Commission, Quebec Autorite des marches financiers (AMF) and Ontario Securities Commission (OSC) today announced a comprehensive arrangement to facilitate their supervision of regulated entities that operate across the U.S.-Canadian border.

SEC Chairman Mary L. Schapiro, AMF President and CEO Jean St-Gelais and OSC Chair David Wilson executed a memorandum of understanding (MOU) that provides a clear mechanism for consultation, cooperation, and exchange of information among the SEC, AMF and OSC in the context of supervision. The MOU sets forth the terms and conditions for the sharing of information about regulated entities, such as broker-dealers and investment advisers, which operate in the U.S., Quebec and Ontario.

The SEC, AMF and OSC have a long history of cooperation particularly in securities enforcement matters. This MOU would extend this cooperation beyond enforcement by setting forth a framework for consultation, cooperation and information-sharing related to the day-to-day supervision and oversight of regulated entities. The supervision of regulated entities is critical to encouraging compliance with the securities laws, which in turn helps to protect investors and the securities markets generally.

The MOU was signed in Montreal on June 10, 2010, after the close of the 35th Annual Conference of the International Organization of Securities Commissions (IOSCO). It follows on the heels of the IOSCO Task Force on Supervisory Cooperation Report, which was published on 25 May 2010 and is available at: http://www.iosco.org/library/pubdocs/pdf/IOSCOPD322.pdf

In response to the recent financial crisis, the Task Force and many other groups, including the G20, have recommended that regulators enhance the supervision of internationally-active regulated entities by working with their foreign counterparts.

This MOU is the first comprehensive supervisory MOU to be signed by the SEC since the start of the financial crisis. The SEC currently has comprehensive supervisory MOUs with the securities regulators in the United Kingdom, Germany and Australia. These MOUs are available at: http://www.sec.gov/about/offices/oia/oia_cooparrangements.shtml.

SEC Chairman Schapiro said, "Our organizations share a strong commitment to overseeing the markets and protecting investors. This agreement will help us to fulfill our roles by giving us access to needed information. I look forward to working closely with the AMF and OSC."

AMF President and CEO St-Gelais said, "Since our markets have become so interrelated and given the impact of the recent financial crisis, this MOU is an important step in ensuring that our markets are safe and that our investors are protected by optimum cooperation between the SEC and the AMF and OSC. It is essential that entities operating across borders be effectively regulated, and this cannot be achieved without the cooperation envisioned by this MOU."

OSC Chair Wilson said, "This MOU reflects the close working relationship between the OSC, AMF and the SEC, as well as the extent to which our market participants operate across our respective borders. It will further enhance the effectiveness of our cooperative activities which are essential for regulators to prevent financial harm and protect investors."

Ethiopis Tafara, Director of the SEC's Office of International Affairs, said, "This MOU builds upon the strong relationship that the SEC has with the AMF and OSC regarding securities enforcement. It expands and formalizes our information-sharing relationship for supervising those regulated entities that operate across our borders and will allow us to oversee these firms in a coordinated fashion. The SEC, AMF and OSC have a long-standing cooperative relationship, and we are pleased to enhance that relationship with this MOU."

For additional information on the MOU, contact:

John Nester, Director
SEC Office of Public Affairs
(202) 551-4120

Sylvain Theberge
Autorite des marches financiers
(514) 940-2176

Wendy Dey, Director
OSC Communications & Public Affairs
(416) 593-8120

(Press Rel. 2010-101)

ENFORCEMENT PROCEEDINGS

Former Mayer Brown Partner Settles SEC Fraud Action

The U.S. Securities and Exchange Commission announced that on June 11, 2010, a settled final judgment was entered by the U.S. District Court for the Southern District of New York against Joseph P. Collins, a former partner with the law firm Mayer Brown LLP, in the Commission's action alleging that he aided and abetted a financial fraud at his longtime client, Refco Group Ltd. As alleged in the Commission's complaint, Collins substantially assisted Refco Group Ltd. and its corporate successor, Refco Inc. (hereinafter, together Refco), in concealing hundreds of millions of dollars in related party indebtedness and related party transactions. The complaint further alleged that, notwithstanding his knowledge and awareness of the related party indebtedness and transactions, Collins reviewed and revised Refco disclosure documents that failed to mention these facts to potential investors. The final judgment against Collins, to which he consented without admitting or denying the Commission's allegations, enjoins him from violating the antifraud provisions of the Securities Exchange Act of 1934.

Collins was convicted of conspiracy, securities fraud, and wire fraud in a related federal criminal prosecution. In January 2010, Collins was sentenced to 7 years in prison. SEC v. Joseph P. Collins, 07 CV 11343 (JSR) (USDC, SDNY)] (LR-21555; AAE Rel. 3145)

SELF-REGULATORY ORGANIZATIONS

Immediate Effectiveness of Proposed Rule Changes

A proposed rule change filed by NYSE Amex (SR-NYSEAmex-2010-49) to rescind Rule 60A - NYSE Amex Equities has become effective under Section 19(b)(3)(A) of the Securities Exchange Act of 1934. Publication is expected in the Federal Register during the week of June 14. (Rel. 34-62263)

A proposed rule change filed by NASDAQ OMX BX, (SR-BX-2010-039) relating to halting trading whenever trading in the underlying security has been paused by the primary listing market has become effective under Section 19(b)(3)(A) of the Securities Exchange Act of 1934. Publication is expected in the Federal Register during the week of June 14. (Rel. 34-62268)

A proposed rule change filed by NASDAQ OMX PHLX (SR-Phlx-2010-82) relating to trading halts in options during a trading pause in the underlying security has become effective under Section 19(b)(3)(A) of the Securities Exchange Act of 1934. Publication expected in the Federal Register during the week of June 14. (Rel. 34-62269)

A proposed rule change filed by NASDAQ Stock Market (SR-NASDAQ-2010-071) relating to trading halts in options during a trading pause in the underlying security has become effective under Section 19(b)(3)(A) of the Securities Exchange Act of 1934. Publication is expected in the Federal Register during the week of June 14. (Rel. 34-62270)

A proposed rule change filed by International Securities Exchange related to trading halts (SR-ISE-2010-58) has become effective pursuant to Section 19(b)(3)(A) of the Securities Exchange Act of 1934. Publication is expected in the Federal Register during the week of June 14. (Rel. 34-62271)

A proposed rule change filed by Chicago Board Options Exchange related to individual equity options overlying stocks subject to trading pauses due to extraordinary market volatility (SR-CBOE-2010-055) has become effective pursuant to Section 19(b)(3)(A) of the Securities Exchange Act of 1934. Publication is expected in the Federal Register during the week of June 14. (Rel. 34-62272)

A proposed rule change filed by NYSE Amex amending NYSE Amex Rule 953NY to provide that the exchange will halt trading when an underlying security is the subject of a trading pause (SR-NYSEAmex-2010-55) has become effective pursuant to Section 19(b)(3)(A) of the Securities Exchange Act of 1934. Publication is expected in the Federal Register during the week of June 14. (Rel. 34-62273)

A proposed rule change filed by NYSE Arca amending NYSE Arca Rule 6.65 to provide that the exchange will halt trading when an underlying security is the subject of a trading pause (SR-NYSEArca-2010-50) has become effective pursuant to Section 19(b)(3)(A) of the Securities Exchange Act of 1934. Publication is expected in the Federal Register during the week of June 14. (Rel. 34-62274)

A proposed rule change filed by NYSE Arca (SR-NYSEARCA-2010-52) amending NYSE Arca Equities Rule 7.11 to set forth how the exchange will handle order flow during a trading pause for a security listed on an exchange other than NYSE Arca has become immediately effective pursuant to Section 19(b)(3)(A) of the Securities Exchange Act of 1934. Publication is expected in the Federal Register during the week of June 14. (Rel. 34-62281)

A proposed rule change filed by International Securities Exchange to amend the qualification standards for market makers to receive a rebate for adding liquidity (SR-ISE-2010-54) has become effective pursuant to Section 19(b)(3)(A) of the Securities Exchange Act of 1934. Publication is expected in the Federal Register during the week of June 14. (Rel. 34-62282)

A proposed rule change filed by NYSE Amex (SR-NYSEAmex-2010-56) amending Rule 80C to clarify reopening procedures has become immediately effective pursuant to Section 19(b)(3)(A) of the Securities Exchange Act of 1934. Publication is expected in the Federal Register during the week of June 14. (Rel. 34-62283)

A proposed rule change filed by New York Stock Exchange (SR-NYSE-2010-45) amending Rule 80C to clarify reopening procedures has become immediately effective pursuant to Section 19(b)(3)(A) of the Securities Exchange Act of 1934. Publication is expected in the Federal Register during the week of June 14. (Rel. 34-62284)

Proposed Rule Changes

The NASDAQ Stock Market filed a proposed rule change (SR-NASDAQ-2008-014) and Amendments No. 1 and 2 thereto under Section 19(b)(1) of the Securities Exchange Act of 1934 to amend certain corporate governance disclosure requirements for listed companies. Publication is expected in the Federal Register during the week of June 14. (Rel. 34-62285)

Financial Industry Regulatory Authority has filed with the Securities and Exchange Commission a proposed rule change, as modified by Amendment No. 1, under Rule 19b-4 (SR-FINRA-2010-028) to adopt NASD Rule 3210 (Short Sale Delivery Requirements) as FINRA Rule 4320 in the consolidated FINRA rulebook. Publication is expected in the Federal Register during the week of June 14. (Rel. 34-62288)

Approval of Proposed Rule Change

The Commission approved a proposed rule change submitted by NASDAQ OMX BX, (SR-BX-2010-027) pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 to establish new fee for TotalView service available to non-professionals and to establish an optional non-display usage cap for internal distributors of TotalView. Publication is expected in the Federal Register during the week of June 14. (Rel. 34-62258)

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http://www.sec.gov/news/digest/2010/dig061410.htm