2 SEC Commissioners To Exit

Posted on May 13, 2015 by admin

Brokerdealer.com blog update profiles the shake up in one of the brokerdealer’s governing bodies, the Securities and Exchange Commission (SEC), is about to get. The White House is already in search of a replacement for Democratic commissioner Luis Aguilar and now they will also have to find a replacement for Republican commissioner Daniel Gallagher. This brokerdealer.com blog update is courtesy of InvestmentNews’ article, “SEC’s Daniel Gallagher resigning as commissioner“, with an excerpt below.

Daniel Gallagher is resigning his post as a Republican member of the Securities and Exchange Commission after four years, a time marked by partisan battles over the regulatory response to the 2008 financial crisis,according to three people familiar with the matter.

The White House will now need to replace him as well as Luis Aguilar, the Democratic commissioner whose term expires next month. The departures herald a transformation at the agency, which has struggled to write dozens of new regulations arising from the 2010 Dodd-Frank Act.

Mr. Gallagher, 42, plans to remain on the five-member commission until a successor is confirmed, a process that could take several months, the people said. The White House has already identified candidates to fill both his and Mr. Aguilar’s seats.

A securities lawyer and ex-agency staff member, Mr. Gallagher has been a critic of many of the rules required by Dodd-Frank. Known for his forceful dissents and speeches, he frequently rapped the Federal Reserve for trying to impose its oversight on firms traditionally regulated by the SEC.

While Mr. Gallagher clashed with former Chairwoman Mary Schapiro on policy matters, he has a less-strained relationship with current SEC chief Mary Jo White. He was instrumental in negotiating a compromise overhauling rules for money market mutual funds in July 2014, passed during Ms. White’s tenure.

To continue reading about the leadership leaving the SEC, click here.

Mindbody IPO Continues In Recent Fitness Trend

Posted on May 12, 2015May 12, 2015 by admin

On the tail of FitBit’s IPO filing last week, brokerdealer.com blog update profiles fitness software company, Mindbody, filing for its own IPO, on Monday, May 11, 2015. Mindbody is a cloud-based software provider in the health, wellness and beauty industries. Their software is most commonly used in fitness-centered businesses such as gyms and yoga studios. Mindbody’s initial primary focus was on business management software for wellness and fitness boutiques, when it was founded in 1998, and since then they have expanded to spas and beauty salons as well. The way the business works is businesses, such as gyms, spas, and yoga studios, pay a monthly fee to use the software. Mindbody currently serves more than 42,000 local business subscribers in 124 countries and territories.

The Mindbody IPO will be listed under the symbol MB, but has not selected an exchange yet. Morgan Stanley, Credit Suisse and UBS Investment Bank are the joint bookrunners on the deal. No pricing terms were disclosed.

This update is courtesy of the Pacific Coast Business Times’ article by Elijah Brumback, “Mindbody targets global expansion with IPO“. An excerpt of the article is below.

Mindbody, best known for its business management software for health and wellness companies, is going public with a target of raising $100 million.

In a deal that’s been heralded as the first non-bank stock offering in decades for a company based in San Luis Obispo, Mindbody filed its offering statement with the Securities and Exchange Commission on May 11.

An IPO has long been expected for the growing company, which recently debuted its new headquarters complex located on Tank Farm Road near the SLO airport. The company counts 42,000 local business subscribers in 124 countries, with revenues of $70 million in 2014.

Company CEO Rick Stollmeyer, who owns just over 11.2 percent of the firm, told the Business Times going public will help push the software firm’s global expansion.

“Our mission is to help wellness-based businesses be more successful,” he said. “This [IPO] enables us to do even more of that.”

After years of development, Mindbody rolled out a major corporate wellness platform last year and raised almost $100 million in venture capital to become San Luis Obispo County’s 11th-largest employer and fourth-largest private-sector job creator with about 900 employees on the Central Coast. The company’s headcount is expected to grow to roughly 1,100 in the next several years.

To continue reading about Mindbody’s IPO filing, click here.

SEC And Finra Team Up To Host BrokerDealer Compliance Outreach Program

Posted on May 11, 2015 by admin

Brokerdealer.com blog update profiling the SEC and Finra announced the opening of registration to attend their National Compliance Outreach Program for BrokerDealers this summer. The program will host regulators and industry professionals as they discuss ideas for compliance structures in the industry. This brokerdealer.com blog update is courtesy of LeapRate’s article, “SEC and FINRA to hold national compliance outreach program for Broker-Deale” by Andrew Saks-McLeod, with an excerpt below.

The Securities and Exchange Commission and the Financial Industry National Regulatory Authority (FINRA) today announced the opening of registration for their 2015 National Compliance Outreach Program for Broker-Dealers. The program is intended to provide an open forum for regulators and industry professionals to discuss compliance practices and exchange ideas on effective compliance structures.

The SEC’s Office of Compliance Inspections and Examinations (OCIE), in coordination with the SEC’s Division of Trading and Markets, is sponsoring the program with FINRA. The program will be held on July 14 at the SEC’s Washington D.C. headquarters and will focus on 2015 priorities for OCIE and FINRA as well as current topics of interest including cybersecurity, anti-money laundering, and firms’ approaches to supervision and sales practices.

“This program provides an invaluable opportunity to facilitate discussions between regulators and industry participants on important issues affecting the brokerage industry, to promote compliance with federal securities laws, and to enhance investor protection,” said Kevin Goodman, National Associate Director of OCIE’s broker-dealer examination program. “Past programs have been well attended and well received, and we look forward to a candid exchange of ideas with participants at our upcoming event.”

To continue reading about this event hosted by the SEC and Finra, click here.

Brombardier’s IPO Hope To Demonstrate Company’s Real Value

Posted on May 7, 2015 by admin

Brokerdealer.com blog update profiling Brombardier’s plan to launch an IPO for its train unit. Bombardier is a Canadian multinational aerospace and transportation company, founded by Joseph-Armand Bombardier. This will push the company into an even better finacial postion after it raised $3 billion earlier this year. They also hope by launching this IPO they can demonstrate the strength the rail unit has after its valuation suffered from being paired with the struggling aerospace division. This update is courtesy of the Wall Street Journal’s article, “Bombardier Plans IPO for Transportation Unit” by Ben Dummett, with an excerpt from the article below.

Bombardier Inc. said Thursday it was preparing to spin off a minority stake in its train business, a move that would create another big publicly traded train maker in Europe while helping the Canadian company to shore up its balance sheet as it continues to work on bringing its troubled CSeries jet to market.

The planned initial public offering of Bombardier Transportation marks Chief Executive Alain Bellemare’s first strategic move since Bombardier tapped the former United Technologies Corp. executive in February to help revive its fortunes. Bombardier has bet much of its future growth on its new CSeries commercial jet, but costly delays have delayed the aircraft’s launch, prompting the management shakeup and a strategic review of operations to generate efficiencies.

Family-controlled Bombardier plans to sell a minority stake in Bombardier Transportation in an IPO in the fourth quarter, and list the shares in Germany where the business is based. The business would compete for investor attention with two other listed train makers in Europe: Germany’s Siemens AG and France’s Alstom S.A.

The sale will enable Montreal-based Bombardier, meanwhile, to further bolster its financial position after it raised about $3 billion earlier this year from an issue of new debt and equity. An IPO would also, the company hopes, demonstrate the rail unit’s real value. The business’s valuation has suffered because it is paired with the struggling aerospace division.

To continue reading about this IPO, which will be launched in Germany, click here.

Industry’s Largest Firm, LPL Financial, Hit With Huge Fine

Posted on May 6, 2015 by admin

Brokerdealer.com blog update profiles Finra hitting LPL Financial, the industry’s largest independent brokerdealer firm, with a huge fine. The firm reportedly failed to properly supervise sales of complex products, such as ETFs, variable annuities and non-traded REITs. In addition to paying a fine to Finra, LPL Financial will also have to pay a substantial amount of restitution to certain customers who purchased non-traditional ETFs, and may pay additional compensation to ETF purchasers following an additional review of its ETF systems and procedures. This update is courtesy of InvestmentNews’ article, “LPL Financial fined $11.7 million for ‘widespread supervisory failures‘”, with an excerpt from the article below.

The Financial Industry Regulatory Authority Inc. ordered LPL Financial to pay $11.7 million in fines and restitution for what it deemed “widespread supervisory failures” related to sales of complex products, according to a settlement letter released Wednesday.

From 2007 to as recently as April, LPL failed to properly supervise sales of certain investments, including certain exchange-traded funds, variable annuities and nontraded real estate investment trusts, and also failed to properly deliver more than 14 million trade confirmations to customers, according to Finra.

LPL, for example, did not have a system in place to monitor the length of time customers held securities in their accounts or to enforce limits on concentrations of those complex products in customer accounts, Finra said.

The systems that LPL had in place to review trading activity in customer accounts were plagued by “multiple deficiencies,” Finra said. The firm failed to generate proper anti-money laundering alerts, for instance, and did not deliver trade confirmations in 67,000 customer accounts, according to the settlement letter.

To continue reading about the industry’s largest independent broker-dealer firm’s huge fines from Finra, click here.