By: Daniel Knight, Ben Kneebush and Madison Jeffreys
As Artificial intelligence (AI) continues to be adopted and used by Australian Financial Services (AFS) licensees broadly, it has become increasingly evident that many licensees’ deployment of AI falls short of their existing regulatory obligations and emerging best practices.
Read MoreBy: Jim Bulling, Simon Kiburg and Alex Parker
When assessing how to comply with the new reporting obligations, reporting entities should recognise the differences in the enforcement approach that ASIC will take in relation to mandatory climate reporting compared with the approach adopted by it in relation to Greenwashing.
Read MoreBy: Cheryl L. Isaac, Clifford C. Histed, and Benjamin C. Skillin
On 2 October 2024, the Commodity Futures Trading Commission (CFTC) announced multiple actions related to fraud in the voluntary carbon credit (VCC) market, just over one year after establishing the Environmental Fraud Task Force. Specifically, the CFTC filed a complaint in federal court against the former CEO of a carbon credit project developer and, on the same day, settled charges against CQC Impact Investors LLC (CQC) and its former COO, all related to a deceptive scheme purportedly intended to reduce carbon emissions.
Read MoreBy: C. Todd Gibson, Robert H. McCarthy Jr., and Jamie M. Robinson
The time has come to finalize those end-of-year checklists and for anyone with US entities, foreign entities doing business in the United States, or for those who are planning to form or register entities to do business in the United States, the United States Corporate Transparency Act (CTA) should be at the top of the list. This includes investment advisers and funds that they manage.
Read MoreBy: Pablo Man and Benjamin Skillin
On 2 October 2024, the Securities and Exchange Commission (SEC) announced settled charges against one of the largest carbon credit project developers (the Developer), for fraudulently altering data concerning its business and making material misrepresentations in the offering of equity to institutional investors in the United States. The SEC’s order found that the Developer violated Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder.
Read MoreBy Cheryl L. Isaac, Matthew J. Rogers, and Benjamin C. Skillin
On 20 September 2024, the Commodity Futures Trading Commission (CFTC) released final guidance regarding the listing of voluntary carbon credit (VCC) derivative contracts on CFTC-registered exchanges known as designated contract markets (DCMs). VCCs are tradable, intangible instruments issued by a carbon crediting program and generally represent the equivalent of one metric ton of carbon dioxide avoided or removed from the atmosphere. As with other commodities, the CFTC does not have regulatory authority over VCCs, but can promulgate guidance and regulations related to derivatives on VCCs.
Read MoreBy: Jim Bulling and Anthony Shorten
On 11 September 2024, the Attorney-General introduced the Anti-Money Laundering and Counter-Terrorism Financing Amendment Bill 2024 (Cth) to the Federal Parliament, following two periods of consultation undertaken by the Department of the Attorney-General, and AUSTRAC over 2023 and 2024.
Read MoreBy: Robert L. Sichel and Ruth E. Delaney
In July, two federal district courts in Texas stayed the effective date (slated for 23 September) of the Department of Labor’s (DOL’s) amended fiduciary rule that would define when a financial professional is acting as a “fiduciary” under ERISA by virtue of providing nondiscretionary investment advice to participants in 401(k) plans, IRAs, and similar clients. On Friday 20 September 2024, the DOL informed the courts that the DOL is appealing to the United States Court of Appeals for the Fifth Circuit to reverse the lower courts’ decisions.
Read MoreBy: C. Todd Gibson, Pablo J. Man, and Brian Doyle-Wenger
On 17 September 2024, the SEC announced settled charges against 11 institutional investment managers for failing to file Form 13F. In addition, two of the 11 firms also failed to file Forms 13H as large traders. The penalties ranged from US$175,000 to US$725,000, and in the aggregate exceeded US$3 million combined. However, two firms self-reported and paid no penalties and one firm self-reported Form 13H filing violations and paid no penalties on that portion of the settlement. Furthermore, all of the institutional investment managers made remedial filings covering several years (in one case over 50 such filings).
Read MoreBy: Jim Bulling and Anthony Shorten
Much of the recent media commentary on greenwashing has revolved around enforcement action taken by ASIC against entities who have misled investors or shareholders. However, there has been less discussion on best practices for entities looking to avoid greenwashing.
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