Insights

On February 20, 2025, the Securities and Exchange Commission (SEC) announced the formation of the Cyber and Emerging Technologies Unit, known as “CETU,” which will replace the Crypto Assets and Cyber Unit (“CACU”).

On January 29, 2025, the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) announced a three-month extension of the compliance date for the new Form PF amendments, moving the deadline from March 12, 2025, to June 12, 2025.[1] This extension provides private fund advisers additional time to implement the operational and technological changes required under the updated Form PF reporting framework adopted on February 8, 2024. The agencies’ decision to extend the deadline to June 12, 2025, helps address the challenges associated with the Form PF filing cycle while ensuring that regulators obtain important data beginning with the second quarter of 2025.

On February 5, 2025, the newly sworn-in Attorney General Pam Bondi issued a memorandum with the subject Total Elimination of Cartels and Transnational Criminal Organizations. Attorney General Bondi’s memorandum lays out four distinct avenues to achieve President Trump’s stated policy of eliminating TCOs and Cartels.[1]  These include changing DOJ charging priorities, “removing bureaucratic impediments to aggressive prosecutions,” expanding certain task forces related to TCOs and Cartels, and advocating for certain legislative changes. 

Form PF and the General Instructions have undergone significant revisions in recent years. The most recent changes, finalized February 8, 2024, with a fast-approaching March 12, 2025 compliance date, introduced prescriptive filing requirements regarding the aggregation of private funds and other entities, with significant changes to the General Instructions and Form PF questions.[1] The February 8, 2024 amendments follow the SEC’s May 3, 2023 amendments, which marked the first major update to Form PF since its inception and significantly expanded private fund reporting obligations. The SEC’s recent enforcement actions and significant amendments to Form PF have heightened regulatory expectations for private fund advisers. With the March 12, 2025 compliance date fast approaching, private fund advisers must prioritize compliance and operational readiness to ensure timely and accurate reporting of Form PF.  

On September 30, 2024, the SEC announced the settlement of an enforcement action against Marathon Asset Management, L.P. (Marathon) for failing to implement proper policies and procedures to prevent the misuse of material nonpublic information (MNPI).  The issue stemmed from Marathon’s participation in ad hoc creditors’ committees, where the firm inadvertently received MNPI through its consultants and advisers.  This enforcement action highlights the SEC’s intense focus on the participation by investors in ad hoc creditors’ committees and the importance of implementing robust MNPI controls when doing so.

On August 26, 2024, the U.S. Securities and Exchange Commission announced that it had settled charges with Sound Point Capital Management, LP, a New York-based registered investment adviser, for inadequate policies and procedures regarding its handling of material nonpublic information (“MNPI”) and related compliance deficiencies in its collateralized loan obligations (“CLOs”) trading activities. Sound Point agreed to pay a $1.8 million civil penalty in addition to other remedial measures. Notably, the SEC did not charge the investment adviser or its employees with violating SEC Rule 10b-5.

The Private Fund Rules were the most comprehensive set of regulations for the private funds industry since the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (“Dodd-Frank”). On June 5, 2024, a unanimous three-judge panel of the U.S. Court of Appeals for the Fifth Circuit (“Fifth Circuit”) vacated the Private Fund Adviser Rules (“Private Fund Rules”).

On June 26, 2024, a 6-3 majority of the U.S. Supreme Court narrowed the scope of federal bribery law by ruling that 18 U.S.C. § 666 does not cover gratuities provided to officials for past acts. The Court held that Section 666, which outlaws bribery of state and local officials when federal funds are involved, does not extend to “gratuities” that follow an official act, in large part because regulation of such gifts is a matter of state and local law.

As collaboration tools and ephemeral messaging applications become ubiquitous in the modern workplace, the Antitrust Division of the Department of Justice (“DOJ”) and the Federal Trade Commission (“FTC”) are making clear that their content must be preserved like traditional modes of communication. On Friday, January 26, the DOJ and the FTC announced that they are updating language in their standard preservation letters and specifications for all second requests, voluntary access letters, and compulsory legal process, including grand jury subpoenas. Manish Kumar, Deputy Assistant Attorney General of the DOJ’s Antitrust Division in charge of criminal enforcement, noted that both DOJ and the FTC expect that companies and their current and former employees will preserve any and all responsive messages, regardless of their default settings to autodelete. An intentional failure to produce these communications may be treated as obstruction of justice.

Public companies now have a pathway to request a delay in their cybersecurity incident disclosure to the U.S. Securities and Exchange Commission (“SEC”). On December 6, 2023, the Federal Bureau of Investigation (“FBI”) Cyber Division published the “Cyber Victim Requests to Delay Securities and Exchange Commission Public Disclosure Policy Notice” (the “Policy Notice”) in response to the SEC’s finalized disclosure rules (the “Final Rules”). Published on July 26, 2023, the Final Rules established guidelines around cybersecurity risk management, strategy, governance, and incidents for public companies subject to the Securities Exchange Act of 1934. Among several requirements under the Final Rules, companies are required to disclose cybersecurity incidents within four days of a materiality determination by filing an SEC Form 8-K.

On October 30, 2023, the Securities and Exchange Commission (the “SEC”) filed a civil lawsuit charging SolarWinds Corporation (“SolarWinds” or the “Company”) and its chief information security officer, Timothy G. Brown (“Brown”), with securities fraud, internal controls failures, misleading investors about cyber risk, and disclosure controls failures, among other violations.  The SEC’s claims arise from allegedly known cybersecurity risks and vulnerabilities at SolarWinds associated with the SUNBURST cyberattack that occurred between 2018 and 2021.

On July 26, 2023, the SEC finalized long-awaited disclosure rules (the “Final Rules”) regarding cybersecurity risk management, strategy, governance, and incidents by public companies that are subject to the reporting requirements of the Securities Exchange Act of 1934.  While the end results are substantially similar to rules proposed by the SEC in March 2022, there are some key distinctions. 

On February 22, 2023, United States Attorneys for the Southern and Eastern District of New York announced a new, nationwide United States Attorneys’ Offices Voluntary Self-Disclosure (“VSD”) Policy. The policy applies to all United States Attorney’s Offices and is effective immediately. The implementation of the policy follows Deputy Attorney General Monaco’s September 15, 2022 memorandum instructing each component of the Department of Justice that prosecutes corporate crime to review, or draft and publicly share its policies on corporate voluntary self-disclosure and Assistant Attorney General Kenneth A. Polite, Jr’s remarks on revisions to the Criminal Division’s Corporate Enforcement Policy. The VSD policy incentivizes companies to voluntarily disclose misconduct and offers significant benefits for timely disclosure.

On September 15, 2022, Deputy Attorney General Lisa Monaco announced major updates to the Department of Justice’s (“DOJ”) criminal enforcement policy at the NYU Program on Corporate Compliance and Enforcement, following a yearlong review of the Department’s white collar enforcement practices. These updates were also documented in a 15-page memo that summarized the review conducted by the DOJ’s Corporate Crime Advisory Group. On September 20, 2022, Principal Deputy Attorney General Marshall Miller delivered a keynote address that further detailed the updates.

On April 4th, the Antitrust Division of the Department of Justice announced updates to its leniency program, issuing an updated policy and set of frequently asked questions (“FAQs”), marking the first updates to the program since 2017 and offering a window into a higher bar that the Biden Administration is setting for those seeking leniency.

On March 9, 2022, the Securities and Exchange Commission (SEC) issued proposed rules and amendments to enhance and standardize disclosures regarding cybersecurity risk management, strategy, governance, and incident reporting by public companies (registrants) that are subject to the reporting requirements of the Securities Exchange Act of 1934.

This week, a DOJ Antitrust Division official signaled a significant expansion of its criminal enforcement program. While speaking at the ABA White Collar Conference in San Francisco, Deputy Assistant Attorney General Richard Powers said that the Division is considering criminally prosecuting violations of Section 2 of the Sherman Act, which prohibits monopolization. This is a major break from long-standing Division policy that it would prosecute only per se violations of the antitrust laws, and raises potentially significant due process concerns.

At a time when everyone -- from automotive OEMs trying to obtain critical computer chips to consumers purchasing new appliances -- is frustrated by supply chain disruptions, the Justice Department is the latest federal partner to step into the fray to address those problems. Yesterday the Antitrust Division and the Federal Bureau of Investigation announced the formation of a joint initiative to deter, detect, and prosecute illegal collusion under the guise of global supply chain disruptions.