K. Susan Grafton counsels a wide variety of broker-dealers, including U.S. and multinational broker-dealers, full service firms, institutional and retail broker-dealers, equity and fixed income alternative trading systems, investment banking boutiques, and private placement agents as well as securities exchanges. She is ranked nationally by Chambers USA in the Broker-Dealer (Compliance) and Broker-Dealer (Enforcement) categories. Clients note her “problem-solving orientation. I find her to be very practical and she can work with us on getting to a positive resolution. She always has her client's goals in mind.” (Chambers USA 2017). Market observers call her “an excellent regulatory attorney” and note that “Susan’s work has always been very impressive.” (Chambers USA 2018). They also note that she is “very well connected in the industry, and is able to get the SEC and FINRA to be more responsive” (Chambers USA 2016). Clients also describe her as “a go-to attorney…especially in Regulation M issues and distribution type questions, [where] she's very knowledgeable” (Chambers USA 2015).
Ms. Grafton’s practice includes representing broker-dealers in all aspects of regulatory compliance, beginning with assisting them in registering with the SEC – as alternative trading systems as well as broker-dealers – and obtaining membership in the Financial Industry Regulatory Authority (FINRA) and other self-regulatory organizations (SROs). As part of this process, she drafts all needed documents, such as written supervisory procedures, customer account documents, soft dollars and commission sharing agreements, and electronic access agreements. She also advises clients on new business initiatives and assists them in obtaining required SRO and state approvals. Similarly, she handles the regulatory approvals in connection with changes of control of broker-dealers. Ms. Grafton also advises clients on broker-dealer status questions for themselves and their employees, including compliance with the Rule 15a-6 safe harbor for foreign broker-dealers and drafts agreements and procedures related to the same.
Ms. Grafton’s practice is wide ranging and includes advising clients on regulatory issues related to nearly every aspect of a broker-dealer’s business, financial, operations and supervisory responsibilities. For example, she advises clients on compliance issues relating to Regulations ATS, NMS, SCI and SHO; sponsored access and other electronic trading issues; large trader and position reporting; suitability and standard of care issues; Regulation M and FINRA’s corporate finance rules; information barriers and insider trading; soft dollars and commission sharing arrangements; research, social media and other written communications; political contributions, outsourcing and expense sharing arrangements; the net capital and customer protection rules; cyber security and data protection issues; books-and-records requirements; and OATS and trade reporting. She is frequently consulted on strategic issues, including the implications of acquiring other financial institutions and developing compliant management and supervisory structures. Ms. Grafton has drafted firmwide and business-specific policies and procedures.
She also represents retail investment advisers, hedge fund and other private fund managers, research providers and trade associations representing the financial services industry. She has been involved in several key policy issues arising from the Dodd-Frank Act, including the uniform standard of care for broker-dealers and investment advisers, municipal advisor registration, private fund adviser registration, and compliance officer responsibilities under new CFTC rules.
Ms. Grafton frequently represents broker-dealers and investment advisers before the SEC and FINRA in connection with regulatory examinations and enforcement investigations pertaining to a wide range of issues, including most recently registration requirements; Rule 15a-6 “chaperoning” arrangements; outside business activities; best execution; markups and markdown, Regulations ATS, M, NMS and SHO; the net capital and customer protection rules; margin requirements; wrap accounts; disclosures; prospectus delivery; supervision; and marketing materials and advertising. She also regularly conducts in-house training on a variety of topics, including preparation for regulatory examinations.
Ms. Grafton has a unique combination of regulatory, in-house and law firm experience. She began her career with the SEC’s Division of Trading and Markets (formerly Market Regulation) where she was responsible for interpretations and no-action relief with respect to the net capital and customer protection rules and broker-dealer books and records requirements. She also led several significant rulemaking initiatives, including the proposal and adoption of Regulation M and amendments to Rules 10b-18, and provided regulatory exemptions and interpretations that facilitated numerous multinational securities offerings, merger transactions, and exchange offers. Subsequently, Ms. Grafton served as a vice president and associate general counsel of Goldman Sachs where she advised on a variety of strategic, regulatory compliance and operational issues related to the firm’s institutional equities sales and trading businesses. Most recently, Ms. Grafton was a partner in the broker-dealer and securities enforcement practices of a large international law firm’s Washington, D.C., and New York offices.
K. Susan Grafton counsels a wide variety of broker-dealers, including U.S. and multinational broker-dealers, full service firms, institutional and retail broker-dealers, equity and fixed income alternative trading systems, investment banking boutiques, and private placement agents as well as securities exchanges. She is ranked nationally by Chambers USA in the Broker-Dealer (Compliance) and Broker-Dealer (Enforcement) categories. Clients note her “problem-solving orientation. I find her to be very practical and she can work with us on getting to a positive resolution. She always has her client's goals in mind.” (Chambers USA 2017). Market observers call her “an excellent regulatory attorney” and note that “Susan’s work has always been very impressive.” (Chambers USA 2018). They also note that she is “very well connected in the industry, and is able to get the SEC and FINRA to be more… Continue Reading
McDaniel College, B.A., 1980
The Catholic University of America, Columbus School of Law, J.D., 1985
Georgetown University Law Center, LL.M., 1989
District of Columbia
American Bar Association, Federal Securities Law Committee of the Section of Business Law
Former Chair, Trading and Markets Subcommittee
FINRA Corporate Financing Rules Subcommittee
Hedge Funds Subcommittee
The Association of Securities and Exchange CommissionAlumni
Board of Advisors, Securities and Exchange Commission Historical Society
Securities Industry and Financial Markets Association, Legal and Compliance Division
Shedding Light on Dark Pools – The SEC Acts to Increase Transparency and Oversight of Alternative Trading Systems — Presented by the Practising Law Institute, Washington D.C. (October 25, 2018)
Bitcoin + 10: Ten Years of Virtual Currencies and Blockchain — New York, NY (October 11, 2018)
Hedge Funds Nuts & Bolts: Brexit for Hedge Fund Managers – 6 months and Counting — (October 10, 2018)
Political Contributions and “Pay-to-Play” — Presented by the Regulatory Compliance Association (September 19, 2018)
FinTech 2018 — Presented by The Practising Law Institute, New York, NY (August 13, 2018)
Moderator, "BlockChain and Cryptocurrencies – The Global Regulatory Landscape" panel.
Private Fund Regulatory Developments and Compliance Challenges 2018 — Presented by The Practising Law Institute, New York, NY (January 31, 2018)
K. Susan Grafton chairs the program as panelists review the SEC’s examination priorities for the new year, along with many recurring compliance concerns such as conflicts of interest and cybersecurity as well as derivatives-related compliance challenges, including an overview of the NFA's 2018 hot button issues along with recent enforcement actions. The program also features a roundtable of private fund general counsel who discuss the issues they grapple with now and are anticipating in 2018.
Hedge Fund and Private Equity Enforcement & Regulatory Developments 2017 — Presented by the Practising Law Institute, New York, NY (November 30, 2017)
Speaker, "SEC Inspections and Examinations of Private Hedge and Equity Funds" panel addressed the following topics: The SEC’s Private Funds Unit –new investigative techniques and unannounced exams;Illiquid positions, conflicts of interest and allocation of fees and expenses; Coordination between OCIE, Enforcement and Investment Management during the exam and afterwards; How to best prepare for and survive an OCIE exam; andUse of data analytics in the exam process.
Business Skills Institute | Corporate Counsel University — CLE Seminar Presented by the Greater Philadelphia ACC, Philadelphia, PA (September 19, 2017)
Speaker, "BlockChains" and "Bitcoins" program discussed the fundamentals of BlockChains – is there more than one? –and virtual currencies, including bitcoins. Speakers discussed the developing regulation of these products under securities, commodities and banking regulations. Also explored were various uses of cryptocurrency, including through initial coin offerings.
FinTech 2017 — Presented by the Practising Law Institute, New York , NY (August 16, 2017)
The Practising Law Institute's (PLI) FinTech 2017 explored the legal and compliance issues arising out of the explosive advances in financial technology, including crowdfunding, blockchain technology and cryptocurrency, including bitcoin,and the advent of robo-advisors, among others.
Rules and Best Practices to Prevent the Exploitation of Older Investors — IRI's Government, Legal & Regulatory Conference 2017, Washington, D.C. (June 13, 2017)
Moderator, "Rules and Best Practices to Prevent the Exploitation of Older Investors" panel.
Private Fund Regulatory Developments and Compliance Challenges 2017 — Presented by the Practising Law Institute, New York, NY (January 11, 2017)
Hedge and Private Fund Enforcement & Regulatory Developments 2016 — Presented by the Practising Law Institute, New York (December 1, 2016)
Speaker, “Current Regulatory Issues Affecting Private Funds” panel discussed: Potential impact of administration change on SEC and CFTC; CFTC’s Regulation AT; SEC rulemaking, including business continuity and transition planning rules, and Advisers Act updates; Broker-dealer registration post-Blackstreet and FINRA’s Capital Acquisition Broker Rule; Cybersecurity; FinCEN’s anti-money laundering rules; and Overview of impact on private funds of MiFID II.
Compensation Planning Journal Advisory Board Meeting — Presented by Bloomberg BNA, New York, NY (November 15, 2016)
Speaker, "Compensation Planning Journal Advisory Board Meeting" presented by Bloomberg BNA, on the impact of the U.S. Department of Labor’s (DOL) new fiduciary rules on broker-dealers.
Regulation of Financial Services 2016: Navigating an Evolving Regulatory Landscape — Presented by the Thomson Reuters Legal Executive Institute, Washington, D.C. (June 8, 2016)
Speaker, "Untamed Wilds: Assessing FinTech Proliferation in the Current Regulatory Climate" panel.
Rules and Best Practices for Preventing Exploitation of Older Investors — IRI Government Legal & Regulatory Conference 2016, Washington, D.C. (June 6, 2016)
Speaker, “Rules and Best Practices for Preventing Exploitation of Older Investors” panel.
Older Investors Summit 2016 — Presented by the Insured Retirement Institute, New York, NY (February 11, 2016)
Moderator, "Regulator Roundtable: Initiatives to Educate and Protect Older Americans" panel.
Private Fund Regulatory Developments and Compliance Challenges 2016 — Presented by the Practising Law Institute, New York (January 13, 2016)
Hedge and Private Fund Enforcement & Regulatory Developments 2015 — Presented by the Practising Law Institute, New York, NY (November 19, 2015)
Speaker, "Current Regulatory Issues Affecting Private Funds" panel. Topics discussed include: CPO/CTA registration and exemptions, Dodd-Frank implementation – capital and margin requirements, CFTC position limit and aggregation rules, cross-border regulatory issues, Volcker Rule and systemic risk regulation, and the NYSE’s rulemaking petition relating to short sale reporting.
Lawyers Council Spring Meeting, Enforcement and Settlement Principles in the New Era: Private Practitioners' Views — Financial Services Roundtable (May 14, 2015)
Hedge Fund Compliance & Regulatory Challenges 2015 — Practicing Law Institute (January 7, 2015)
Hedge and Private Fund Enforcement & Regulatory Developments 2014 — Practicing Law Institute (November 18, 2014)
Regulators' Focus on High Frequency Trading and U.S. Market Structure Continues; It's No Flash in the Pan — Practicing Law Institute (July 22, 2014)
Broker-Dealer Regulation, Compliance, and Enforcement Briefing — America Law Institute (January 1, 2014)
SEC & FINRA Examinations of Broker-Dealers: Priorities & Hot Issues — Association of the New York City Bar and the District of Columbia Bar Association (October 1, 2013)
2013 Lawyers Council Spring Meeting, CFTC-SEC Update — Financial Services Roundtable (May 2, 2013)