How any court could determine that FSOC acted within or without the law is a mystery, since the statutory provision that establishes the basis for designation of a firm as systemically significant is inherently ambiguous. Section 113 of Dodd-Frank simply does not establish "law" as the term is commonly understood; it does not establish any objective rules that can be understood by those who would either be subject to it or interpret it. Congress should consider repeal of Section 113. It is…

It is an unfortunate demonstration of the extent to which financial regulation has become politicized that this amendment is being attacked as a give-away to the bank when, in fact, Senate Democrats acknowleged in open statements on the floor that it was their poor drafting of Dodd-Frank that had resulted in language that required end-users to post margin. The mistake was not corrected during the prior Congress for reasons that were not related to regulatory policy; there seems no reason not…

This settlement is important for several reasons. Most notably, the penalty is significant ($35 million), the firm admitted wrongdoing, and the firm's CEO was personally charged. More broadly, a number of compliance lessons may be learned from this settlement with respect to the presentation of past performance information:

Firms should be mindful that principal trades with advisory clients continue to be an area of focus for SEC examination and enforcement actions. Specifically, the (the "Release") noted that "the staff has examined and will continue to examine firms that engage in principal transactions and will take appropriate action to help ensure that firms are complying with section 206(3) or rule 206(3)-3T (as applicable), including possible enforcement action." The Release also cited a number of…