The SEC’s Continuing Focus on Rule 105: No Let-Up in Sight
In 2015, the Division of Enforcement (the “Division”) of the Securities and Exchange Commission (the “SEC”) continued its focus on Rule 105 (“Rule 105” or “Rule”) of Regulation M, as evidenced by the SEC’s announcement of its third round of enforcement actions against six firms. See Press Release, SEC Charges Six Firms for Short Selling Violations in Advance of Stock Offerings (Oct 24, 2015), available at https://www.sec.gov/news/pressrelease/2015-239.html. One of the respondents, which previously had been sanctioned for violations of Rule 105, was barred for a period of one year from participating in stock offerings. See In the Matter of War Chest Capital Partners LLC, Release No. 34-76140 (Oct. 14, 2015), available at https://www.sec.gov/litigation/admin/2015/34-76140.pdf.