Posts Tagged ‘Securities and Exchange Commission’

Banking and finance roundup

  • D.C. Circuit’s en banc decision upholding constitutionality of CFPB disappointing but not surprising. On to SCOTUS [Ilya Shapiro, Aaron Nielson, Jonathan Adler]
  • Big thinking under way at the SEC could replace securities class action sector with free contract: “The SEC should authorize mandatory arbitration of shareholder class action lawsuits” [Bainbridge, Benjamin Bain/Bloomberg News (noting that broker dealers have long been free to use arbitration clauses)]
  • Milberg Weiss founder Melvyn Weiss dies at 82 [ABA Journal, our coverage over the years of Weiss and his firm, @PaulHorwitz (“Give generously, and to the right people, so that your NYT obit can be a glowing apologia despite a few inconvenient facts.”)]
  • Here come the shareholder derivative suits over sleazy-boss #MeToo scandals [Kevin LaCroix] “NERA: 2017 Securities Suits Filed at ‘Record Pace'” [same]
  • Rogoff rebuttals: “More Evidence of the High Collateral Damage of a War on Cash” [Lawrence White, Cato, earlier] “Money as coined liberty” [David R. Henderson]
  • Quotas/targets for percentages of women, disabled and indigenous persons on Canadian corporate boards? [Terence Corcoran/Financial Post, more]

Banking and finance roundup

Banking and finance roundup

  • New research suggests “SEC rule intended to prevent conflicts of interest among staff has actually had the perverse effect of causing staff to profit from their knowledge as insiders of the SEC” [Thaya Brook Knight, Cato]
  • “Federal Prohibition Left California Cannabis Farmers Without Insurance or Banks When Wildfires Struck” [Christian Britschgi]
  • “Is Dodd-Frank/SOX reform dead?” [Stephen Bainbridge]
  • Trial lawyers and CFPB did little to correct Wells Fargo fake-account scandal [Ted Frank WSJ letter]
  • Study finds that more-cumbersome judicial foreclosure methods tend to correlate with tougher lending standards especially for poor; should constriction of home credit for poorer households be interpreted as a good? [Brian Feinstein, Chicago via CL&P]
  • A different way to encourage more prudent home lending practice, scale back FDIC coverage [Scott Sumner]

Time to revisit the Chevron stretch

A case called Digital Realty Trust v. Somers gives the Supreme Court a chance to rein in a particularly inappropriate use of the Chevron doctrine, under which courts give deference to agencies’ interpretations of law [Ilya Shapiro, Harvard Law Review blog]

The last few years have of course seen renewed attention — academic, judicial, and journalistic — to the question of whether courts have become altogether too deferential to executive agencies. While Chevron deference (and its cousins, Auer and Seminole Rock deference) was originally justified as a necessary tool for preventing courts from unduly meddling in administrative decisionmaking, hasn’t the pendulum swung too far?…

As the Supreme Court explained in Long Island Care at Home, Ltd. v. Coke in 2007, the APA [Administrative Procedure Act] requires an agency conducting notice-and-comment rulemaking to provide the public with “fair notice” of what will be, or might be, included in its final regulation. Yet there was nothing in the [Securities and Exchange Commission’s Notice of Proposed Rulemaking] that would have given any notice to the public that it was going to change whom Dodd-Frank would protect from retaliation.

Just last year, the Court reaffirmed in Encino Motorcars, LLC v. Navarro that procedurally deficient rules that violate the APA do not receive Chevron deference because they lack the “force of law.” The SEC regulation here was procedurally deficient because of the final rule’s fair-notice problem, so it shouldn’t qualify for Chevron.

More on the Somers case and Cato’s amicus brief: Trevor Burrus and Frank Garrison.

Banking and finance roundup

  • “The Rise of Financial Regulation by Settlement” [Matthew C. Turk, Columbia Law School Blue Sky Blog]
  • Before buying into the idea that fractional reserve banking has some sort of fraudulent roots, consider the common law concepts of detinue, bailment, and debt [George Selgin, Cato]
  • Cato files brief urging Supreme Court to clarify constitutional status of SEC’s use of in-house administrative law judges [Thaya Brook Knight on Lucia v. SEC]
  • Between FATCA and the Patriot Act, American extraterritorial banking rules keep wreaking havoc on other countries [Ernesto Londoño, New York Times on Uruguay legal marijuana businesses]
  • “Congress Can Rescind the CFPB’s Gift to Trial Lawyers” [Ted Frank, WSJ]
  • “Absent Reform, Little Relief in Sight from Chronic “Merger Tax” Class-Action Litigation” [Anthony Rickey, WLF]

Banking and finance roundup

Banking and finance roundup

Supreme Court and constitutional law roundup

All-Cato edition:

Good riddance (if they’re indeed going) to the Dodd-Frank conflict minerals rules

President Trump is said to be considering an executive order suspending for a time the Dodd-Frank law’s provisions on conflict minerals, which have harmed American companies and consumers and also plunged many communities further into impoverishment in some of the poorest sections of Africa. Congress should rise to its part by repealing the provisions, I argue at Cato at Liberty. More: Hans Bader/CEI, Kevin Drum/Mother Jones, earlier, and as part of a wider look at securities regulation, Wallace DeWitt/National Affairs. More: Dominic P. Parker and Bryan Vadheim, JAERE; Tate Watkins, WSJ.

Banking and finance roundup

  • SEC in-house administrative law judges are unconstitutional, rules 10th Circuit, creating circuit split [ABA Journal, Jonathan Adler]
  • “Dear Sen. Warren: If we care to share our policy views, we’ll let you know. Otherwise MYOB. Signed – 33 firms” [Elizabeth Warren letter demanding to know what financial firms think of delay in Labor Department fiduciary rule, coverage WSJ/MarketWatch]
  • New York Gov. Andrew Cuomo’s grab for more regulatory power over financial institutions would erode due process protections [New York Post quoting Mark Calabria]
  • “Supreme Court Probes Whether Miami Can Sue Banks Over Foreclosure Crisis” [Daniel Fisher, earlier on Bank of America v. Miami here, etc.] Arnold Kling’s prescriptions for getting the government out of the mortgage market;
  • Mini-symposium on the personal benefit standard for insider trading in the recent Supreme Court case of Salman v. U.S. [Bainbridge]
  • India’s devastating crackdown on cash [Cato Daily Podcast with Jim Dorn and Caleb Brown]