The IRS has identified three situations that are at high risk for a FATCA-related audit. These situations include (i) a withholding agent's failure to properly withhold or correctly perform due diligence, (ii) a foreign financial institution's failure to account for properly, and therefore report, its individual account holders, and (iii) a U.S. account holder's failure to report its accounts properly. Over the next several months, the IRS also will continue to tailor its enforcement to identify mismatches in the information it receives through the automatic exchange of FATCA-related

The SEC settled charges against the CEO of two brokerage firms for allowing employees to mislead customers. According to the SEC, the firms under the CEO's control engaged in a scheme that caused customers to pay substantially higher amounts than the disclosed commissions for buying and selling securities. The scheme involved concealing the practice of routing trading orders to an offshore affiliate in order to take hidden markups and markdowns. The CEO authorized his employees to suspend the taking of improper profits temporarily when a customer asked for a specific report that could reveal

FINRA issued a regulatory notice soliciting comments on a proposal to expand the dissemination of TRACE data to include additional securitized products; specifically, collateralized mortgage obligations ("CMOs"), commercial mortgage-backed securities and collateralized debt obligations. FINRA proposed to shorten the reporting timeframe for these additional securitized products from the end of day to 45 minutes and, after nine months, to 15 minutes. FINRA also proposed to simplify the reporting requirements for pre-issuance CMOs. Comments are due by April 10, 2015. See: FINRA Reg. Notice 15-04.

The CFTC announced that Chair Massad will testify before the U.S. House Committee on Agriculture, and before the U.S. House Committee on Appropriations, Subcommittee on Agricultural, Rural Development, and Food and Drug Administration. Chair Massad will present the CFTC's outlook for 2015 before the Agriculture Committee. The hearing is scheduled for February 12, 2015. Additionally, Chair Massad will discuss the CFTC's 2016 budget request before the Appropriations Subcommittee at a hearing on February 11, 2015. See: CFTC Event Announcement: Agriculture Committee; CFTC Event Announcement

The SEC announced that two former Chief Financial Officers ("CFOs") have agreed to return nearly a half-million dollars in bonuses and stock sale profits that they received when their software company was still committing accounting fraud. While not personally charged with the company's misconduct, the CFOs are required under Sarbanes-Oxley Act Section 304 to reimburse the company for bonuses and stock sale profits received during the time in which the fraud occurred. According to the SEC's order, the company overstated its pre-tax earnings and made material misstatements about its revenue