Spelling and pronouncing English words can be a challenge. I've often been puzzled by the word "guarantee". What's the point of including the unpronounced "u"? In English, the letter "g" may have either a soft (e.g., as in "legend" and "gerund") or...
Readers will recall that last year the California legislature created a statutory exemption for finders from the California's registration requirement for broker-dealers (Chap. 743, Stats. 2015). That exemption, codified at Corporations Code Section...
In the midst of the Great Depression, The New Yorker published a poem by Ogden Nash entitled "Bankers Are Just Like Anybody Else, Except Richer". But are bankers really wealthier than hoi polloi? The answer may be found in the Department of Business...
Yesterday's post addressed the use of litotes in California's broker-dealer suitability rule. Litotes can be an effective rhetorical device, but as Judge Frank H. Easterbrook observed, it is also ambiguous. Associated Randall Bank v. Griffin, Kubik,...
The Financial Industry Regulatory Authority, better known as FINRA, imposes a suitability requirement on its members. Rule 2111(a) requires, in part, that a broker-dealer or registered representative "have a reasonable basis to believe that a...
In addition to directors and officers, Section 16 of the Securities Exchange Act of 1934 applies to every person who is "directly or indirectly the beneficial owner of more than 10 percent of any class of any equity security (other than an exempted...
In Luther v. Countrywide Financial Corp., 195 Cal. App. 4th 789 (2011), the trial court ruled that state courts do not enjoy concurrent jurisdiction when a class action meeting the definition of a “covered class action” under the Securities...
I spent the Fourth of July holiday in the Fürstentum Liechtenstein, a very beautiful and surprisingly inaccessible part of Europe. Its capital city has no airport. The country is also largely vertical, as it is sandwiched in the Alps between Austria...
In April, I wrote about a bill, SB 726 (Hueso), that would have added a new section to the Corporate Securities Law banning false statements to government officials for the purpose of manipulating the price of a company's security by triggering an...