SEC Charges Issuer for Failing to Make Public Filings
The Securities and Exchange Commission today charged W2007 Grace Acquisition I Inc., a real estate investment firm, with failing to make required public filings. W2007 Grace, which is indirectly owned by one or more private equity funds affiliated with The Goldman Sachs Group Inc., has agreed to pay $640,000 to settle the SEC’s charges relating to eight missed filings.
According to the SEC’s order instituting administrative proceedings, W2007 Grace went “dark” in November 2007, after its reporting obligations for its class B and class C preferred shares were suspended upon its filing with the Commission a notice of suspension of its duty to file public reports pursuant to Section 15(d) of the Securities Exchange Act of 1934. At the time, W2007 Grace had fewer than 300 holders of record of the preferred shares. Once the suspension took effect, the rules required W2007 Grace to resume reporting if the number of holders...
SEC Announces Million-Dollar Whistleblower Award to Compliance Officer
The Securities and Exchange Commission today announced an award of more than a million dollars to a compliance professional who provided information that assisted the SEC in an enforcement action against the whistleblower’s company.
The award involves a compliance officer who had a reasonable basis to believe that disclosure to the SEC was necessary to prevent imminent misconduct from causing substantial financial harm to the company or investors.
“When investors or the market could suffer substantial financial harm, our rules permit compliance officers to receive an award for reporting misconduct to the SEC,” said Andrew Ceresney, Director of the SEC’s Division of Enforcement. “This compliance officer reported misconduct after responsible management at the entity became aware of potentially impending harm to investors and failed to take steps to prevent it.”
The whistleblower in this matter will receive between $1.4 million and $1.6 million. Whistleblower awards can range from 10 percent to 30 percent...
Fort Worth Regional Director David Woodcock to Leave SEC
The Securities and Exchange Commission today announced that David Woodcock, Regional Director of the Fort Worth office and leader of the Enforcement Division’s nationwide Financial Reporting and Audit Task Force, is leaving the SEC later this spring.
As the regional director of the Fort Worth office since 2011, Mr. Woodcock has overseen a staff of attorneys, accountants, examiners, and other professionals responsible for conducting investigations, litigation, and examinations in a region that includes Texas, Oklahoma, Arkansas, and Kansas. He helped form and lead the Financial Reporting and Audit Task Force that comprises a group of accountants and attorneys using innovative methods and technology to prevent, detect, and investigate potential fraud in financial statements and other accounting documents. Mr. Woodcock received an Excellence in Leadership Award from the SEC in 2013.
Associate Regional Directors Marshall Gandy, who oversees the office’s examination program and David Peavler, who oversees its enforcement program, will serve as...
SEC Charges BlackRock Advisors With Failing to Disclose Conflict of Interest to Clients and Fund Boards
The Securities and Exchange Commission today charged BlackRock Advisors LLC with breaching its fiduciary duty by failing to disclose a conflict of interest created by the outside business activity of a top-performing portfolio manager.
BlackRock agreed to settle the charges and pay a $12 million penalty. The firm also must engage an independent compliance consultant to conduct an internal review.
According to the SEC’s order instituting a settled administrative proceeding, Daniel J. Rice III was managing energy-focused funds and separately managed accounts at BlackRock when he founded Rice Energy, a family-owned and operated oil-and-natural gas company. Rice was the general partner of Rice Energy and personally invested approximately $50 million in the company. Rice Energy later formed a joint venture with a publicly-traded coal company that eventually became the largest holding (almost 10 percent) in the $1.7 billion BlackRock Energy & Resources Portfolio, the largest Rice-managed fund. The SEC’s order finds that...
SEC Announces Agenda for May 13 Meeting of the Equity Market Structure Advisory Committee
The Securities and Exchange Commission today announced that its Equity Market Structure Advisory Committee will hold its first meeting on May 13. The meeting will focus on Rule 611 of SEC Regulation NMS, known as the “Order Protection Rule” or “Trade-through Rule.”
Rule 611 requires trading centers to have policies and procedures designed to prevent “trade throughs” – trades at prices that are inferior to displayed and immediately accessible quotations at other trading centers.
“Enhancing our equity market structure remains a top priority,” said SEC Chair Mary Jo White. “As we continue to make progress in this important area, the committee’s experience and diverse viewpoints will provide valuable insight as we work together to further strengthen our overall market structure.”
The Commission established the advisory committee in February to provide a formal mechanism through which the Commission can receive advice and recommendations on equity market structure issues.
The meeting will be held...