Tags: compliance, David Chaves, FBI
Enough, already! You don’t need to increase your compliance staff 20-fold; you just need to stop insider-trading.
Speaking at a conference for in-house lawyers at hedge-funds, the FBI’s David Chaves said he’d seen some hedge-fund firms expand their compliance teams from two people to 40 during the past several years, a period when the U.S. government has cracked down on insider trading.
“It’s nice to see, but it’s also important to say, ‘Is it all necessary?’” said Mr. Chaves, acknowledging the seeming curiosity of his stance. “I believe it’s gone too far in many respects.” Compliance efforts, he said, should not choke the ability of a firm to complete its investment functions day to day.
And if you don’t, well, watch out for Mary Jo White’s bolder SEC and any employees who wouldn’t mind retiring early to a tropical island.
The Securities and Exchange Commission is ramping up its penalties in an “aggressive” bid to deter misconduct by imposing more punitive sanctions, the agency’s co-chief of enforcement said Tuesday.
“Monetary penalties speak very loudly and in a language any potential defendant understands,” Andrew Ceresney told a legal conference in New York….
“There is room for bolder actions,” he said. “Enforcement needs to be aggressive in our use of penalties.”
FBI Agent: Hedge-Fund Compliance Can Miss the Point, but the FBI Won’t [WSJ MoneyBeat blog]
SEC Ramps Up Fine Amounts to Deter Misconduct [WSJ]
Whistleblower Awarded More Than $14 Million [WSJ]