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Bitcoin Triggers SEC Investor Alert

Protecting stockholders from the investment risks of Bitcoin and other virtual currencies, the U.S. Securities and Exchange Commission’s (“SEC”) Office of Investor Education and Advocacy has released Bitcoin and Other Virtual Currency-Related Investments. Since Bitcoin, as well as other virtual currencies, can be exchanged and used like real money for purchases, the SEC’s Investor Alert warns of the possibility of increased fraudulent activities and high-risk investments. Per the Investor Alert, risks include: Bitcoin investments not being insured from loss like other investments; Bitcoin’s exchange rates are generally unstable and could drop drastically; Federal, state or foreign governments may limit Bitcoin. Read More.

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Initiative on Rethinking Financial Disclosure Announced

In response to the U.S. Securities and Exchange Commission (“SEC”) Chair Mary Jo White’s plea for simplifying Form 10-K disclosure requirements, the Institute for Corporate Responsibility (“ICR”) at the George Washington University School of Business and the Center for Audit Quality (“CAQ”) have created the Initiative on Rethinking Financial Disclosure (“the Initiative”). With teams of graduate students from George Washington’s School of Business, the project will feature research of issues related to effective corporate disclosure. Each team will examine Form 10-K reports from Fortune 500 companies, and recommend how to decrease insignificant or unneeded reporting requirements without losing the information’s. Read More.

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Conflict Minerals’ Emergency Appeal Denied

Despite an attempt to file an emergency motion for a stay of the U.S. Securities and Exchange Commission’s (“SEC”) entire Conflict Minerals rule, the U.S. Court of Appeals for the District of Columbia Circuit (“the Court”) has rejected the request. While the Court previously ruled the Conflict Minerals’ final rule was a violation of the U.S. Constitution’s First Amendment, the SEC later issued a partial stay that mandates companies to use language disclosing whether any of their products are “DRC conflict free”. The SEC also released guidance to continue implementing the provision requiring businesses to file their conflict mineral reports. Read More.

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NYSE Receives Fine for Trading Violations

Without acknowledging or denying allegations brought forth by the U.S. Securities and Exchange Commission (“SEC”), the New York Stock Exchange LLC (“NYSE”; “the Exchange”) and three affiliates have agreed to pay a $4.5 million fine. Announced on May 1st, the SEC claimed the NYSE and its affiliates violated numerous operating rules and securities laws. Per the complaint, NYSE Arca Inc. purportedly created an “error account” in 2005 before the NYSE merged with affiliate Archipelago Exchange a year later. This was seen as a violation due to the transaction occurring before the market regulator approved the account. Further, the SEC claimed. Read More.

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Final Auditing and Attestation Standards Published

After receiving approval from the U.S. Securities and Exchange Commission (“SEC”), the Public Company Accounting Oversight Board (“PCAOB”) has posted its final auditing and attestation standards. Updated recently on its website, the standards include: Auditing Standard No. 17, Auditing Supplemental Information Accompanying Audited Financial Statements, and associated amendments; Attestation Standard No. 1, Examination Engagements Regarding Compliance Reports of Brokers and Dealers; Attestation Standard No. 2, Review Engagements Regarding Exemption Reports of Brokers and Dealers, and associated amendments; and Amendments conforming to the Dodd-Frank Act; which modify some PCAOB rules to the audits and auditors of broker-dealers listed with the SEC. Amendments to the PCAOB rules will be effective. Read More.

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Conflict Minerals’ Effective Date Gets a Stay

Announced on May 2nd, the U.S. Securities and Exchange Commission (“the Commission”; “SEC”) issued a stay of the effective date for companies to comply with parts of its final rule, Conflict Minerals. The stay affects parts of Exchange Act Rule 13p-1 and Form SD, which mandates public disclosure of a company’s use of conflict minerals from the Democratic Republic of the Congo or neighboring countries. Due to last month’s decision by the Court of Appeals for the District of Columbia Circuit (“the Court”), such disclosure was ruled as violating the First Amendment. As companies move forward applying the final rule. Read More.

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