Overview

Schiff Hardin has long been one of the nation’s leading law firms in securities and commodity futures law and regulation. We helped organize the Chicago Board Options Exchange more than  four decades ago, leading the industry into a new type of securities trading, and we have remained ever since at the forefront of regulatory counseling in the financial markets.

In recent years, and particularly since the financial crisis and the enactment of the Dodd-Frank Act, the laws and regulations governing financial markets and their participants have become more complicated and burdensome. Our experience with the laws governing the financial markets, and the people who write and administer those laws, enables us to guide clients through the challenging regulatory maze they now face, while consistently looking ahead to what may come next.

We Solve Business Problems

We understand that our clients come to us not merely for help complying with current law and regulation, but to maximize business opportunities while minimizing legal and regulatory risk. Our decades-long experience assisting clients throughout the securities and futures industries means that clients receive more than legal advice from us. They also obtain practical advice on how best to solve business problems. Whether the solution involves preparing complex documentation, seeking formal or informal relief from regulators, or identifying ways in which our clients can operate successfully within a changing legal landscape, we go the extra mile to achieve that success.

We Tailor Advice to Meet the Business Needs of Our Clients

We help clients achieve their goals across the full range of markets and products spanning the securities, futures, swaps and OTC derivative industries. A brief list of representative engagements includes advice on:

  • Broker-dealer, investment adviser and investment company mergers, acquisitions and changes in control;
  • Broker-dealer and investment adviser supervisory programs;
  • Broker-dealer confirmation delivery, books and records, and broker-dealer custody of assets;
  • Commission sharing, soft dollar and directed brokerage/commission rebate arrangements;
  • Family offices;
  • Bank securities activities;
  • Swaps and futures recordkeeping provisions for registered and unregistered entities;
  • End-users regulatory parameters under the new swaps regulations;
  • Commodity pool operator definition and potential exemptions;
  • Forward contract exclusion to the “swap” and “future delivery” definitions; and
  • Listing and trading shares in ETFs.

 

Where the regulatory issues are unclear, we often are asked to obtain no-action or informal relief from the staffs of regulators. Our success in obtaining such relief has been notable. We also conduct “mock audits” on behalf of clients, to help them prepare for regulatory exams.

In other instances, regulators discover facts that may raise issues under applicable federal law or self-regulatory organization rules. In those instances, we work with the regulators on behalf of our clients to resolve those regulatory concerns.

Our Team

Our group includes former senior officials from the Securities and Exchange Commission and law enforcement agencies (including a former Division Director. Our many years of experience working with regulators and industry participants enable us to provide efficient, finely tuned compliance advice that is not just responsive to the latest regulatory pronouncements, but also assists clients to prepare for an ever-changing legal, regulatory and business landscape.

  • Experience

    A few examples of recent successes with regulators include:

    • An industry vendor wanted to send standardized confirmations to institutional customers on behalf of broker-dealers, where the broker-dealer responsible for the confirmation would send a URL link to its standardized disclosures typically appearing on the back of the confirmation. Decades of legal and regulatory interpretations raised uncertainty as to whether these confirmations would satisfy the federal securities laws. We helped our client obtain no-action relief from the SEC on behalf of the securities industry for use of their confirmations.
    • An ETF sponsor wanted its funds to include higher levels of restricted securities than the SEC had previously allowed. The sponsor came to us after it was unable to persuade the SEC to allow this action. After speaking with the SEC and the listing exchanges about their regulatory concerns and providing additional information, we successfully negotiated with the SEC to allow our client to achieve its goal of making more liberal use of restricted securities in its funds.
    • A bank client wanted to offer an employee bonus program that took into account bank customer referrals to a broker-dealer. The client was concerned that taking referrals into account when determining bonuses might violate federal law on bank securities activities. We advised our client on ways to structure its program in a manner that would comply with the federal securities laws.
    • A major broker-dealer client wanted to lower its capital charges in connection with alternative investments offered through a new service of a registered clearing agency. We obtained no-action relief under the SEC’s financial responsibility rules, allowing the client to lower its capital charges for these alternative investments when relying on the new service.

    The above examples provide just a small sampling of the kind of advice we provide clients year-in and year-out. We tailor our compliance advice to the actual business needs of our clients, helping them to achieve business success while complying with applicable law and regulation.