May 29, 2008

Just Extended! Early Bird Discount for Compensation Conferences

We have extended the deadline of our Early Bird Discount since we had so many last minute calls from members who had requested checks so that they could register for our Conferences – “Tackling Your 2009 Compensation Disclosures: The 3rd Annual Proxy Disclosure Conference” & “5th Annual Executive Compensation Conference” – which will take place in New Orleans and via Nationwide Video Webcast on October 21st-22nd. Here are the Conference Agendas. We will not extend the Early Bird Discount beyond the new deadline of June 30th, so please act now.

Like last year’s blockbuster conferences, an archive of the entire video for both conferences will be right there at your desktop to refer to – and refresh your memory – when you are actually grappling with drafting the disclosures or reviewing/approving pay packages. Here are FAQs about the Conferences.

For those choosing to attend by coming to New Orleans, I encourage you to also register for the “16th Annual NASPP Conference,” where over 2000 folks attend 45+ panels. And if you attend the NASPP Conference, you can take advantage of a special reduced rate for the Exec Comp Conferences.

If you have questions or need help registering, please contact our headquarters at or 925.685.5111 (they are on West Coast, open 8 am – 4 pm).

SEC Nominations Move Forward

A Senate Banking, Housing and Urban Affairs Committee hearing is now scheduled for Tuesday, June 3rd to consider the nominations of Luis Aguilar, Elisse Walter and Troy Paredes. The hearing will include a number of other nominees for open positions at various federal agencies, including the Treasury Department, HUD, GNMA, the National Credit Union Administration Board and the President’s Council of Economic Advisors. Once the Senate Banking Committee has considered the nominations, it remains to be seen whether the SEC nominees will be fast-tracked for a vote by the full Senate.

This article from yesterday’s Washington Post notes the government-wide exodus of senior officials as the current administration winds down, as well as the difficulties faced in moving nominees forward. I agree with some of the experts cited in the article that the process of changeover in agencies is exceptionally difficult for the staff and tends to go on for way too long these days. Even for agencies like the SEC, which doesn’t have any political appointees beyond the Commissioners, the unwritten rule is that directors and perhaps other senior Staffers can expect to be replaced when a new Chairman comes aboard. Even in the best of circumstances, this makes for at least a couple of years of uncertainty about the direction of SEC policy and a lot of Staff distraction.

SEC Settles an Auction Rate Securities Case

The SEC recently settled an administrative proceeding instituted against First Southwest Company for its role as an underwriter of and agent for auction rate securities. The auction rate securities market has seen some significant disruptions throughout the credit crisis, and the activities of market participants in connection with recent auctions may receive more attention from Enforcement in the coming months. Back in 2006, the SEC had reached a $13 million settlement with 15 investment banks, and the industry agreed to impose a voluntary code of conduct for the auction-rate market.

The SEC’s Order in the First Southwest case indicates that, without adequate disclosure, the broker-dealer intervened in the auctions that served to reset the interest rate on the securities by bidding for its own account in order to prevent failed auctions and to prevent “all hold” auctions (when a below market rate is set because no securities are for sale in the auction). In some of these interventions, First Southwest’s activity had an effect on the clearing rate derived from the auction, which is the rate that determines the interest rate or yield that the issuer must pay to investors until the next auction. The only charge brought by the SEC on this conduct was for violation of Securities Act Section 17(a)(2), based on the misstatements and omissions about the potential for such intervention in the auctions.

In determining the penalty assessed on First Southwest, the SEC noted the firm’s cooperation, but also noted that First Southwest had not self-reported the potential violations to the SEC. The SEC noted that it “aims to promote voluntary disclosures in industry-wide investigations and to encourage firms to provide comprehensive information to the staff in such investigations.”

– Dave Lynn