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U.S. Securities and Exchange Commission

SEC News Digest

Issue 2010-154
August 17, 2010

COMMISSION ANNOUNCEMENTS

Andrew J. Donohue to Leave SEC After Four Years Leading Division of Investment Management

The Securities and Exchange Commission announced today that Andrew J. "Buddy" Donohue plans to leave the SEC in November after serving more than four years as its Director of the Division of Investment Management.

Mr. Donohue helped develop significant regulations governing the $39 trillion asset management industry, including investor-oriented rules to improve oversight of money market funds, increase investment adviser custody controls, and curtail investment adviser "pay-to-play" abuses. Under his leadership, the SEC also implemented a new mutual fund summary prospectus and investment adviser disclosure brochure, and proposed to replace rule 12b-1 mutual fund distribution fees with a reformed regulatory framework. The agency also recently proposed rule amendments to improve information in target date fund advertisements and marketing.

"Buddy has been an effective leader and investor advocate during his tenure at the Commission. His vast knowledge of mutual funds and the investment advisory landscape has been invaluable in advancing several vital regulatory initiatives," said SEC Chairman Mary L. Schapiro. "We are grateful for his practical insights and innovative guidance, and thank him for his tremendous commitment to public service."

Mr. Donohue said, "It has been a privilege to work with so many dedicated and talented staff members throughout the agency who have contributed to the development of important new rules in the investment management area. I will forever value my time at the Commission and its remarkable mission that I feel fortunate to have been a part of."

Mr. Donohue, 59, was appointed to lead the Division of Investment Management in April 2006. He came to the SEC from Merrill Lynch Investment Managers, where he served as Global General Counsel and oversaw the firm's legal and regulatory compliance functions for more than $500 billion in assets including mutual funds, fixed income funds, hedge funds, private equities, and managed futures. He also was Chairman of the firm's Global Risk Oversight Committee.

Prior to his service at Merrill Lynch Investment Managers, Mr. Donohue spent more than a decade as Executive Vice President, General Counsel, Director, and member of the Executive Committee for OppenheimerFunds, one of the nation's largest retail mutual fund management companies with managed assets of more than $150 billion. He previously was a corporate and securities law partner with private and government clients at the Newark, N.J.-based firm of Kraft & McManimon (now McManimon & Scotland LLC). Mr. Donohue also served as Senior Vice President, General Counsel, and Director for First Investors Corporation, one of the oldest financial service companies in the country dedicated to the individual investor.

Mr. Donohue earned his JD from New York University School of Law in 1975 and his BA, cum laude, with high honors in Economics from Hofstra University in 1972. (Press Rel. 2010-151)


SEC Approves Distribution Plan, Appoints Fund Administrator, and Waives Bond in the Matter of American Skandia Investment Services, Inc.

The Commission announced today that it has approved, as written, the Distribution Plan (Distribution Plan) for the distribution of monies in the matter of American Skandia Investment Services, Inc. (ASISI), pursuant to Rule 1104 of the Securities and Exchange Commission's Rules on Fair Fund and Disgorgement Plans, 17 C.F.R. 201.1104. The Commission also announced that Rust Consulting, Inc., is appointed as Fund Administrator, pursuant to Rule 1105(a) of the Securities and Exchange Commission's Rules on Fair Fund and Disgorgement Plan, 17 C.F.R. 201.1105(a), and that the bond requirement of Rule 1105(c) of the Commission's Rules on Fair Fund and Disgorgement Plans, 17 C.F.R. 201.1105(c), is waived for good cause shown.

The Distribution Plan provides for distribution of $68 million in disgorgement and civil penalties paid by ASISI plus any accumulated interest, less any federal, state or local taxes on the interest. The Distribution Plan provides that the realized profits method will be used to estimate the dilution of Eligible Sub-Accounts, and that the dilution amount measures the harm caused by market timing activities. Accordingly, the funds are not being distributed according to a claims-made process. Pursuant to the Distribution Plan, ASISI is responsible for all costs and expenses of the distribution.

On May 13, 2010, the Commission published a "Notice of Proposed Distribution Plan and Opportunity for Comment" (Notice) pursuant to Rule 1103 of the Commission's Rules on Fair Fund and Disgorgement Plans, 17 C.F.R. 201.1103. See Exchange Act Release No. 62106. The Notice advised all interested parties that they may obtain a copy of the Distribution Plan from the Commission's public website, http://www.sec.gov, or by submitting a written request to Christopher R. Conte, Associate Director, United States Securities and Exchange Commission, 100 F Street, NE, Washington, DC 20549-5561. The Notice also advised that all persons desiring to comment on the Distribution Plan could submit their views, in writing, within thirty (30) days of the date of the Notice, to the Office of the Secretary, United States Securities and Exchange Commission, 100 F Street, N.E., Washington, D.C. 20549-1090; by using the Commission's Internet comment form; or by sending an email to rule-comments@sec.gov. The Commission received no comments on the Distribution Plan and no modification has been made to the Distribution Plan since its publication. (Rel. 34-62733; File No. 3-13446)


SELF-REGULATORY ORGANIZATIONS

Proposed Rule Changes

The NASDAQ Stock Market filed a proposed rule change (SR-NASDAQ-2010-099) pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 to adopt a definition of Professional and require that all Professional Orders be appropriately marked. Publication is expected in the Federal Register during the week of August 16. (Rel. 34-62724)

The Commission issued notice of a proposed rule change submitted by NYSE Amex (SR-NYSEAmex-2010-80) pursuant to Rule 19b-4 under the Securities Exchange Act of 1934 to amend its price list to reflect fees charged for co-location services. Publication is expected in the Federal Register during the week of August 16. (Rel. 34-62731)

The Commission issued notice of a proposed rule change submitted by New York Stock Exchange (SR-NYSE-2010-56) pursuant to Rule 19b-4 under the Securities Exchange Act of 1934 to amend its price list to reflect fees charged for co-location services. Publication is expected in the Federal Register during the week of August 16. (Rel. 34-62732)


SECURITIES ACT REGISTRATIONS


RECENT 8K FILINGS

 

http://www.sec.gov/news/digest/2010/dig081710.htm


Modified: 08/17/2010