The SEC charged the manager of two New York-based hedge funds with conducting a pair of trading schemes involving Chinese bank stocks and making $16.7 million in illicit profits; the firms agreed to pay $44 million to settle the SEC's charges. The gist of the charges is that the managers used confidential information concerning planned placements of Chinese stocks, then shorted the relevant shares prior to public disclosure of the offerings, and covered the shorts out of the offerings. Click here to view press release (links externally to SEC website). See also: SEC Complaint.

FINRA announced that Carol Anthony (John) Davidson, retired Senior Vice President, Controller and Chief Accounting Officer of Tyco International, will join FINRA's Board of Governors as of January 1. Click here to view notice in full (links externally to FINRA website).

Financial Services Committee Chairman Spencer Bachus released a statement at a subcommittee hearing on the economic impact of derivatives regulations contained in Title VII of the Dodd-Frank Act. The closing line of the statement was: " The 113 th Congress will have the opportunity to examine if the rules promulgated by the SEC and CFTC can actually work once they are operational or if we will witness regulatory chaos and a flight of capital from the U.S." Lofchie Comment: One point that Chairman Bachus makes that I think important is that Dodd-Frank will have real economic consequences

In a testimony before the U.S. House Financial Services Subcommittee on Capital Markets and Government Sponsored Enterprises, Chairman Gensler gave a speech on the New Era of Swaps Market Reform. He generally repeated statements, or portions of statements, that he had made in the past. Lofchie Comment: One part of the speech that I thought an interesting development were Chairman Gensler's statements as to the regulation of non-U.S. entities. He said, "For firms that do register with the CFTC, we are very committed to allowing for substituted compliance, or permitting market participants to

The SEC announced that SEC Chief of Staff Didem A. Nisanci will leave the agency at the end of this week. Click here to view notice in full (links externally to SEC website).