PublicationsInsights on Current Policy Issues

• Online Lending Developments
  August 13, 2015

  By David E. Franasiak, Joel G. Oswald, and Hanna Laver

  On July 20, the U.S. Treasury Department published a Request for Information (RFI) in the Federal Register soliciting industry feedback regarding the rapidly growing online lending marketplace. The Department defines online marketplace lending as “the segment of the financial services industry that uses investment capital and data-driven online platforms to lend to small businesses and consumers.” Specifically, Treasury is seeking public comment on: (i) the various business models of, and products offered by, online marketplace lenders to small businesses and consumers; (ii) the potential for online marketplace lending to expand access to credit to historically underserved market segments; and (iii) how the financial regulatory framework should evolve to support the safe growth of this industry.

   

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• New Proposed Pipeline Safety Regulations
  July 14, 2015

  By Frank Vlossak

  On July 10, PHMSA published a Notice of Proposed Rulemaking (NPRM) titled “Operator Qualification, Cost Recovery, Accident and Incident Notification, and Other Pipeline Safety Proposed Changes”. The NPRM would: establish new requirements for certain pipeline employee qualifications; require that pipelines notify the National Response Center “as soon as practicable” following “confirmed discovery” of a covered incident; establish a process for recovering costs for safety review of new projects that cost more than $2.5 billion or employ new technologies; require notification to PHMSA of pipeline flow reversals and changes to the type of product transported; incorporate by reference industry standards on inline inspections and stress corrosion cracking direct assessment (SSCDA); and implement other changes to pipeline safety regulations. Comments are due on August 8, 2015.

   

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• Insider Trading Bills in the 114th Congress
  April 21, 2015

  By David E. Franasiak, Joel G. Oswald, and Hanna Laver

  On December 10, 2014, the U.S. Court of Appeals for the Second Circuit reversed the insider trading convictions of two former hedge fund managers. The court held an individual can only be convicted of insider trading for trading on confidential information if he or she knew the original tipper disclosed it in exchange for a personal benefit. The Court denied a request for an en banc rehearing on April 3, 2015. The only remaining option is to appeal to the Supreme Court, but legal analysts assert that is unlikely. A recent U.S. District Court decision applying the Second Circuit ruling requires the SEC meet a tougher standard at trial for what constitutes insider trading. Judge Jed Rakoff also suggested Congress should formally define insider trading, saying “if unlawful insider trading is to be properly deterred, it must be adequately defined.” In light of the December ruling, several bills were introduced in Congress that would modify the Securities Exchange Act of 1934 to strengthen its prohibitions on trading on material or inside information.  

   

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