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The Commission Announces a Roundtable on Microcap Securities

Roundtable on Microcap SecuritiesToday the Securities and Exchange Commission announced that it’s Microcap Fraud Working Group will hold a roundtable to gather ideas and input on regulatory issues related to “the execution, clearance, and settlement of low-priced securities.”

The roundtable will take place on October 17th and will be open to the public and available live on the Commission’s website. Specific panelists have not yet been announced, but will include representatives from DTC and FINRA, among others, and will discuss issues such as “Anti-Money Laundering monitoring, compliance challenges and potential changes to the regulatory system.”

The Microcap Fraud Working Group is a joint effort of the Division of Enforcement and Office of Compliance Inspections and Examinations that the Commission launched in 2008 to “pursue a strategic approach to combating microcap fraud by focusing on recidivists and insiders, and on the attorneys, auditors, broker-dealers, transfer agents and other gatekeepers that facilitate … ” such fraud.

Mention of the Group has popped up in a handful of releases since then. Most recently in June, when the Commission suspended trading in a number of microcap stocks that were being promoted on bulletin boards and through social media for not having accurate or adequate public information on file.

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