Editor column

Citation

Davis, H.A. (2007), "Editor column", Journal of Investment Compliance, Vol. 8 No. 2. https://doi.org/10.1108/joic.2007.31308baa.001

Editor column

In this issue, we are fortunate to have ten articles by expert practitioners covering current regulatory and compliance developments in the USA, Germany, China, and the UK. Robert Ericson begins with comments on the late-March DC Circuit Court of Appeals decision vacating the SEC rule that has exempted fee-based brokerage accounts from the Advisers Act – an interesting sequel to the DC court decision last year vacating the requirement for hedge funds to register with the SEC. Michael Rosella and Domenick Pugliese provide us with a comprehensive explanation of how the structure and use of Rule 12b-1 fees has evolved since the rule was adopted in 1980 and why some are questioning the continued appropriateness of Rule 12b-1. Then we move on to some of the compliance challenges posed by complex investment instruments such as derivatives; Francis Corbett, Girard Healy, and Kenneth Poudrier outline procedures and controls for processing and valuing swaps in an investment portfolio. Next Riki Fujitani and Eric Kunisaki provide us with an update on e-discovery, including recent court decisions, the new federal rules, and recommendations for investment companies to take proactive approaches by establishing their own e-discovery procedures and systems. One of the biggest scandals on the corporate side of the securities world in the last year or so has been related to stock option backdating. Stephen Alexander, Warren Rissier, and Susan Chun give us a thorough explanation of that issue, including two important recent court decisions and definitions of “spring loading” and “bullet dodging.” Then Paul Glenn shares some insight on the recent rapid growth in the number of investment advisers and assets under management in the USA, along with significant regulatory developments, including recent disciplinary trends, and the strong growth in hedge fund advisers registered with the SEC despite the recent Goldstein decision striking down the requirement to do so. Next, Joseph Borg expresses the North American Securities Administrators Association’s reaction to several recent studies that have recommended that state securities regulators’ authority be weakened or eliminated. The article provides web site references to those studies. Then moving outside the USA, Sven Zeller provides us with an analysis of recent draft amendments to the German Investment Act. Having covered recent anti-money laundering developments in the USA and the UK extensively in recent issues, we are pleased to have a view of anti-laundering programs in China from TieCheng Yang and Nan Zhang. We are particularly pleased to begin coverage of investment company compliance and regulatory issue in Germany and China with this issue of the journal and plan to continue broadening our international content. Finally, Andrew Hougie, Jessica Brescia, Alexandre Marion, Katharina Ebell, Thierry Hudsyn, and Pascal Bouvy offer a comparison of the way the UK, France, and Germany have implemented the EU Transparency Directive.

Henry A. Davis Editor

James A. Tricarico Jr Consulting Editor