A proposed controversial rule change by the Securities and Exchange Commission that would allow private securities like hedge funds to advertise has aroused the ire of the mutual fund industry.
The rule change, which is mandated under the Jumpstart Our Business Startups Act, will affect private securities that are exempt from registration and sold only to accredited investors.
The private securities market is massive. It topped more than $1 trillion last year and continues to grow. Some observers believe these new regulations could be a boon for the private securities industry. But the Investment Company Fund Institute, whose mutual fund members worry about competition, is balking at the proposal.
In an article published in Investment News, the institute alleges that the rule does not go far enough in protecting investors.
“Misleading advertisements by private funds have the potential to confuse investors in funds of all types,” said Paul Schott Stevens, executive director of the institute.
Hedge funds are split on how to bet on German bonds. [Reuters]
Nomura has started a shakeup of its investment banking unit. [DealBook]
Spain’s Banco Santander plans to raise as much as $4.2 billion through the initial public offering of its Mexican unit. [DealBook]
The European Central Bank is expected to present a new debt-purchasing plan to tackle the region’s debt crisis at a meeting Thursday. [Reuters]
Moody’s has informed the European Union that its AAA credit rating is at risk of downgrade. [CNN Money]
A partner in the defunct law firm of Dewey and Leboeuf has accused Citibank of hiding the firm’s financial troubles. [DealBook]
The Federal Reserve has approved the proposed merger between Southern Community Financial Corp. and Capital Bank Financial Corp. [Business Journals]
BondDesk Group LLC has appointed former UBS head of municipal trading John Bagley as president and senior managing director of BondDesk Trading. [On Wall Street]
Independent financial services investor Thomas Morrison has closed his firm, Morrison Financial Services, and joined St. Louis-based Benjamin F. Edwards as vice president for investments. [On Wall Street]
The FDIC has barred Stephen Bradley Budner, 33, a former employee of Cache Bank & Trust in Greeley, NC, from participating in the affairs of any insured depository financial institution under a consent agreement. [Business Journals]
The FDIC has terminated a cease and desist order in place against The First State Bank of Burlingame since December 2008. [Business Journals]