SEC announces results of share class selection disclosure initiative

Abstract

Purpose

To explain the SEC’s Share Class Selection Disclosure Initiative (SCSD Initiative), the purpose it seeks to serve, the results it has generated, and its broader implications for the asset management industry.

Design/methodology/approach

Explains the newly announced results of the SEC’s Share Class Selection Disclosure Initiative. Provides background on the principles underlying the initiative, the mechanics by which the initiative’s self-reporting program operated, and industry reaction to the initiative. Analyzes the results the initiative generated, in terms of both aggregate disgorgement and the terms of settlement offered to self-reporting advisers. Draws conclusions and provides key takeaways.

Findings

Although the terms of the actual settlements were consistent with the framework of standardized settlement terms set forth in the SCSD Initiative, whether the standardized terms of settlement offered under the SCSD Initiative ultimately will be viewed as favorable will depend in large part upon how the SEC continues to treat advisers that did not self-report.

Originality/value

Expert analysis from experienced lawyers in the mutual fund and investment advisory industries.

Citation

Carroll, B., Perlow, M., Schleppegrell, C.A. and Scarritt-Selman, S. (2019), "SEC announces results of share class selection disclosure initiative", Journal of Investment Compliance, Vol. 20 No. 4, pp. 15-20. https://doi.org/10.1108/JOIC-08-2019-0047