Skip to main content

It’s Olympics time once again, and that can only mean one thing: The Russians (who cannot actually compete as Russians, per se, on account of previous Russian Olympic cheating) are cheating. This has us wondering: Given the superhuman feats of regulation shown by Securities and Exchange Commission Chairman Gary Gensler this week—first a slew of new rules putting a crimp in private equity firms’ style and a four-minute-mile-esque demand to half securities settlement times on one day, followed yesterday by another flurry of proposals demanding greater speed from activists in announcing their moves and rolling out the red carpet for whistleblowers, undoing still more of his predecessor’s legacy, such as it is—we’ve got to wonder what sort of regulation-enhancing drugs he’s on.

The proposed rule would reduce the deadline for disclosing such equity positions to five days from 10 days, among other changes, the SEC said. It would also deem holders of some derivative securities to be “beneficial owners” of the underlying company’s stock if the instruments are held “with the purpose or effect of changing or influencing the control of the issuer.”

The SEC said the proposed changes to the two amendments would allow the regulator to increase a possible award, but not lower it, and to pay whistleblower awards for actions that would be otherwise covered by a non-SEC whistleblower program.

“These amendments, if adopted, would help ensure that whistleblowers are both incentivized and appropriately rewarded for their efforts in reporting potential violations of the law to the Commission,” Mr. Gensler said in a statement Thursday.

And that’s not all, for this regulatory biathlete is also shooting down corporate efforts to block shareholder proposals, at least partly making up for the trouble he’s causing activist investors above.

The Securities and Exchange Commission in November overturned several mechanisms that companies routinely use to shoot down shareholder proposals, and specified that shareholders were allowed to press companies on issues of broad social importance…. The SEC-permitted proposal directed at Apple, for example, highlighted a persistent area of concern: the extent to which companies have sought to handle sexual-harassment complaints by pushing employees into closed-door sessions…. The proposal directed at Disney comes from a shareholder—the National Center for Public Policy Research, a conservative think tank—which argued that the company’s antiracism training discriminates against white employees. The SEC rejected Disney’s arguments that the proposal could be excluded from its proxy statement.

SEC Proposes Giving Activist Investors Less Time to Report Positions [WSJ]
SEC Says It Won’t Limit Whistleblower Payouts [WSJ]
Shareholder Voices Poised to Grow Louder With SEC’s Help [WSJ]

For more of the latest in litigation, regulation, deals and financial services trends, sign up for Finance Docket, a partnership between Breaking Media publications Above the Law and Dealbreaker.



Activist Investing Basically Insider Trading, Sayeth Gary Gensler

He’s got a lot of plans for the hedge fund industry, and it’s not going to like them.


Gary Gensler To Do More In First Months Than Jay Clayton Did In Four Years

The little regulator that could has 10b5-1 plans, SPACs, Twitter, accounting and chief compliance officers in his sights.


Gary Gensler May Need No Sleep, But The SEC Staff Does

The regulators are feeling wrung out by all the regulating.

By US government [Public domain], via Wikimedia Commons

Gary Gensler, His Slide Rule Are Coming For Your Bonuses

If companies can’t do math properly, the SEC will do it for them.


Gary Gensler Hires Gary Gensler For Job Gary Gensler’s Been Waiting Seven Years For

Looking for comment letters on undoing everything Jay Clayton did over the last four.


Gary Gensler Comes Not To Mourn SPACs But To Bury Them

The SEC comes for the ailing sector with a coup-de-grace.