Columbia Law School
Sky Blog
Let me start with a warm welcome to our newest colleague, Commissioner Crenshaw. She has been a tremendous asset to the Commission for many years, and I know that she will continue to serve the agency, investors, and the public
Securities Regulation
SEC Commissioners Crenshaw and Lee Discuss Failure to Modernize Accredited Investor Definition
The accredited investor definition is the single most important investor protection in the private market.[1] Today’s amendments purport to “update” that definition while leaving in place 38-year old wealth thresholds, declining to index the thresholds to inflation, and declining
Does Environmental and Social Disclosure Affect Innovation at Companies?
Companies are typically not compelled to disclose environmental and social (E&S) information because this information does not meet the materiality standard used in many jurisdictions. However, some shareholders have an explicit mandate to screen potential investments based on E&S criteria. …
SEC Officials Offer Update on the Consolidated Audit Trail
Today [August 21], the Commission proposed amendments to the national market system (“NMS”) plan governing the consolidated audit trail (“CAT NMS Plan”). The proposed amendments are designed to enhance data security related to the ongoing development and operations of the
Lemonade, Inc.: Harbinger of Future Public Benefit Corporation IPOs?
The last six months have been marked by profound changes in how we live and interact with one another. The COVID-19 pandemic has cast a spotlight on societal inequities and racial injustice and reinvigorated dialogue around sustainability and environmental reform. …
Marginal Benefits of the Core Securities Laws
To many, the core securities laws on disclosure, fraud, and insider trading are desirable from an investor-protection perspective. But the dominant law and economics view is dubious of this thinking. Under this view, securities prices are discounted to reflect obstacles …
Executive Private Misconduct
Over the last few years, misbehavior of corporate executives like Harvey Weinstein, Steve Wynn, Leslie Moonves, and Elon Musk has outraged many people around the world. The misconduct has ranged from the inadvisable to the unethical to the criminal. Almost …
SEC’s Division of Investment Management Director Takes Stock and Looks Ahead
Good Morning. Thank you Barry [Barbash] and Paul [Roye] for the kind introduction and thank you and PLI for inviting me to speak again with you. I looked back at my remarks the last time I was with you. Two
Lessons from Luckin Coffee: The Underappreciated Risks of Variable Interest Entities
On April 2, China’s Luckin Coffee announced that some of its employees, including the chief operating officer, had fabricated over $300 million in reported revenues. On April 21, the Securities and Exchange Commission and the U.S. Public Company Accounting Oversight …
Why the SEC’s Proposal to Amend Rule 13f-1 Should Fail
On July 10, the Securities and Exchange Commission (SEC) proposed a 35-fold increase – from $100 million to $3.5 billion – in the threshold for requiring institutional investment managers to publicly report their equity holdings on Form 13F.[1] This …
SEC Chairman Speaks on Amendments to Proxy Solicitation Rules
Good morning. This is an open meeting of the U.S. Securities and Exchange Commission, under the Government in the Sunshine Act. Today we have two items on the agenda, both continuations of our ongoing work to modernize and enhance the
EBITDAC, Civil Liability, and New Paradigms
COVID-19 has led companies to patch-up financial reporting by adding estimates of pre-COVID-19 profits to their EBITDA. Recently, COVID-19 prompted measuring-equipment manufacturer Schenck Process, for example, to add back €5.4 million, resulting in an adjusted EBITDA of €18.3 …
Cleary Gottlieb Discusses SEC Proposal to Significantly Change Reporting by Institutional Investors
On July 10, 2020, the Securities and Exchange Commission (the “SEC”) proposed changes that would substantially reduce the number of investors required to file quarterly reports showing their holdings of U.S.-listed equities on Form 13F.[1] The SEC’s …
Disgorgement After Liu v. SEC: The Game Is On!
Experienced litigators know that an adverse appellate decision (even from the U.S. Supreme Court) rarely ends their case. The question is instead: What is the next move? What defenses do we fall back on? So it is likely to be …
SEC Chair Clayton Addresses the Financial Stability Oversight Council
Market Functioning and Monitoring
We have continued our efforts to help facilitate the orderly and fair market function, including in coordination with our colleagues at the Federal Reserve and Treasury.[1]
Market activity has remained active in June and thus
Cooperation in Securities Market Regulation: Perspectives from Australia
The global financial crisis highlighted the interconnectedness of international financial markets and the risk of contagion it posed. The crisis also emphasized the importance of supranational regulation and regulatory cooperation to help address and ameliorate that risk.
Yet, although capital …
SEC Commissioner Advocates ESG Disclosure for Asset Managers, Not Issuers
Good afternoon, everyone. Thank you, Keir [Gumbs], for the kind introduction, and thank you to the Society for Corporate Governance for the invitation to speak today. I had been looking forward to seeing everyone in Colorado this week but, of
Activist Short Selling Today: The Two Sides of the Coin
Two extraordinary accounting scandals — one at Luckin Coffee Inc. in China and the other at Wirecard AG, the German digital payments firm — have revealed brazen and bankrupting frauds, directed by the most senior executives at each firm. Together, …
Did Congress Trade Ahead on News of Covid-19?
In a new paper,[1] we study the impact on U.S. stock prices of news stories about accusations that several members of Congress traded ahead of private material information about COVID-19. The lawmakers traded stocks during the early stages of …
The Role of Investor Attention in Seasoned Equity Offerings
Many studies of seasoned equity offerings (SEOs) have attempted to explain the decline of a company’s stock price after it announces an SEO (see, e.g., Asquith and Mullins (1986) or Masulis and Korwar (1986)). The literature has focused on the …