Regulating Federal Securities Law Claims In Corporate Charters: The Dilemma Confronting Delaware

By | October 14, 2019

Courtesy of Mohsen Manesh In Sciabacucchi v. Salzberg, the Delaware Supreme Court confronts a thorny question at the intersection of state corporate law and federal securities law. Specifically, the case asks whether a Delaware corporation may include a forum selection provision in its corporate charter governing shareholder claims brought under federal securities law. But that narrow… Read More »

Not Everything is About Investors: The Case for Mandatory Stakeholder Disclosure

By | October 10, 2019

Courtesy of Ann Lipton Businesses that operate in the United States are constantly required to disclose information. Both state and federal law require merchants to disclose product and service information to consumers.  Federal law requires employers to disclose workplace hazards to employees.  Data on the racial and gender makeup of a firm’s workforce must be… Read More »

Building Fintech Ecosystems: Why Regulatory Sandboxes Tend to Get the Plaudits and Innovation Hubs Do the Work of Promoting Development, Innovation and Competition in Financial Services

By | October 8, 2019

Courtesy of Ross Buckley, Douglas Arner, Robin Veidt, and Dirk Zetzsche Regulatory sandboxes are the flavor of the month. Over 50 countries have now established or announced a “financial regulatory sandbox” since the UK Financial Conduct Authority established the first one in 2016. Sandboxes are safe spaces in which FinTech start-ups and other innovative enterprises… Read More »

Deal or No Deal? Brexit Implications for UK/EU Financial Services Firms

By | September 16, 2019

Courtesy of Mete Feridun In March 2018, the UK and EU27 reached an agreement on the terms of a transitional period following the UK’s withdrawal from the EU. However, the terms of this deal are conditional on both sides agreeing to a final withdrawal treaty (“Withdrawal Agreement”).  Since Boris Johnson’s ascension to Prime Minster in July, this prospect has grown increasingly unlikely,… Read More »

Danske Bank Money Laundering Case Study

By | September 11, 2019

Courtesy of Lee Reiners and Joseph A. Smith Jr. This case study draws primarily—and in some instances quotes verbatim—from the “Report on the Non-Resident Portfolio at Danske Bank’s Estonian Branch” prepared for the Bank on September 19, 2018, by the law firm Bruun & Hjejle.[1] Additional details are derived from other sources, including Danske Bank… Read More »

Can Technology Undermine Macroprudential Regulation: Evidence from Marketplace Lending in China

By | September 10, 2019

Courtesy of Alberto Manconi, Fabio Braggion, and Haikun Zhu The Global Financial Crisis led economists and regulators to refocus on the relationship between household leverage and macroeconomic performance. The ensuing debate has revolved around how best to contain household debt using a variety of approaches, with much emphasis being placed on loan-to-value (LTV) caps, i.e.… Read More »

Regulators Should be More Prescriptive About the Quantification of Cyber Risks

By | September 5, 2019

Courtesy of Mete Feridun* Although operational risk capital requirements drive a substantial proportion of banks’ capital requirements, quantification of cyber incidents still represent a relative “backwater” of the ever-evolving global regulatory framework. Surprisingly, the new “Basel IV” operational risk framework does not include any specific reference to cyber risks. While regulators expect firms to integrate… Read More »

Dual-Class Stock Structures and Society

By | August 26, 2019

Courtesy of Martin Chang* Issuing multiple classes of stock is a strategy that corporations have used to insulate insiders from outside investor pressure. Each class of stock can differ in a variety of ways, but the most common difference is the number of votes that each share is entitled to. By creating different classes, each… Read More »

A New Source of Systemic Risk: Cloud Service Providers

By | August 8, 2019

Courtesy of David Fratto and Lee Reiners Last week’s announcement that a hacker accessed the personal information of approximately 106 million Capital One card customers and applicants has cast fresh light on financial institutions increasing reliance on the cloud. The hacker, a former employee of Amazon Web Services Inc., allegedly breached Capital One’s firewalls to… Read More »

Can Tax Regulation Curb Excessive Executive Pay?

By | August 7, 2019

Courtesy of Tobias Bornemann, Martin Jacob, and Mariana Sailer For at least two decades, executive compensation has been widely discussed in public policy. Debates about inequality, risk-taking behavior, and excessiveness led to policy interventions – often by means of tax instruments – intending to control executive compensation. For example, back in 1993, the U.S. introduced… Read More »