FiSolve Weekly News Digest: June 20, 2025

Here is what we're reading in the news this week...

Investment Adviser Consents to SEC Order for Custody Rule and Disclosure Violations

The Securities and Exchange Commission (SEC) obtained a final judgment by consent against a New York-based investment adviser (IA) for failing to comply with SEC requirements for the safekeeping of client assets and for failing to disclose material risks and conflicts of interest associated with the IA’s recommendations to clients to use a related Australian firm as a custodian.  The firm consented to an order that permanently enjoins it from violating Section 206(2) of the Investment Advisers Act of 1940 and Rule 206(4)-2 thereunder and imposes a conduct-based injunction that permanently enjoins it from acting as an investment adviser.  Read more here.

Federal Court Orders Two Men and their Companies to Pay Over $25 Million for Digital Asset Fraud

The Commodity Futures Trading Commission announced that the U.S. District Court for the District of Massachusetts entered a final default judgement against two individuals and their companies for defrauding victims in connection with their role in a digital asset fraud scheme.  The Court found the defendants operated a digital asset scheme in which they fraudulently offered the sale of a fully-functioning virtual currency.  The defendants obtained more than $6 million from at least 28 customers through fraudulent solicitations, including false and misleading claims and omissions about the digital coin’s value, usage, and trade status, and that the coin was backed by gold.  The order includes more than $25 million in penalties and disgorgement, in addition to certain remedial measures.  Read more here.

Employee Feedback is Best Delivered in the Morning  

Citing multiple lines of research, Prof. Leigh Thompson writes in the Wall Street Journal that employees may be more receptive to constructive criticism earlier in the day.  This is because more individuals appear to be “morning people.”  Similarly, the concept of decision fatigue suggests that as the day wears on, an individual’s ability to process and respond to complex information deteriorates as compared to earlier in the day.  The report also suggests scheduling reviews during mid-week and erring on the side of more frequent feedback.  Read more here.

SEC Brings Action Against Publisher of Newsletter

The Securities and Exchange Commission (SEC) brought charges against a publisher and his associate for authoring promotional articles through their newsletter that falsely stated that neither the newsletter nor the authors received any compensation for their recommendations.  In reality, two companies paid the individuals for the promotion of their companies in the newsletter pursuant to sham consulting agreements.  The SEC found the publications and their false disclosures gave investors the misleading impression that the recommendations were objective.  The publisher consented to certain remedial measures, including an injunction from engaging in certain promotional activities, disgorgement, a monetary penalty and a bar from serving as an officer and director of a public company for three years. Read more here.

FCA Secures Convictions for Insider Dealing and

Money Laundering 

The Financial Conduct Authority (FCA) obtained a conviction against a research analyst at an asset management firm, who conspired with his sister to misuse confidential market-sensitive information for illegal trading in at least 13 companies.  The analyst used Contracts for Difference (CFDs) through accounts held by associates to mask his involvement.  Despite efforts to conceal the scheme, the FCA’s surveillance systems uncovered the insider dealing, which was further compounded by a separate money laundering conviction involving £198,210 in illicit cash deposits.  The analyst and his sister are scheduled to be sentenced on July 4, at which time the FCA intends to apply for confiscation orders in order to recover the proceeds of crime.  Read more here.

ESMA Issues 2024 Annual Report

The European Securities and Markets Authority (ESMA) published its Annual Report for 2024. The report states that the activities conducted and results achieved in 2024 support ESMA’s strategic priorities and thematic drivers - to foster stable and effective markets, strengthen supervision, and enhance retail investor protection while enabling sustainable finance and facilitating technological innovation and the use of data.  The report also provides an update on key initiatives.  Read more here.

Unemployment Spiking Among US College Graduates 

A report by Oxford Economics finds higher unemployment rates among recent college graduates since mid-2023.  The report attributes this trend primarily as a function of a structural shift in hiring in the tech sector amid strong labor supply growth.  The report anticipates a continuing hiring near-term slowdown in technology and for college graduates in computer science fields.  Read more here.

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