SEC Settles Action Concerning Adequacy of Policies to Prevent Dissemination of Material Nonpublic Information
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Key takeaways
- On November 24, 2015, the Securities and Exchange Commission (the “SEC”) announced a settled action against Marwood Group Research LLC (“Marwood”), a political intelligence firm, for its failure in 2010 to adopt adequate policies that would prevent the dissemination to Marwood’s clients of potential material, nonpublic information (“MNPI”) obtained from government employees.
- The SEC’s enforcement action against Marwood underscores the need for state-registered investment advisers and exempt reporting advisers, as well as SEC registered investment advisers to adopt and maintain policies and procedures that are reasonably designed to prevent the misuse of MNPI.