FiSolve Weekly News Digest: August 8, 2025

Here is what we are reading in the news this week...

SEC Charges Colorado-Based Investment Adviser with Reg M Trading Violations

The Securities and Exchange Commission announced settled charges against a registered investment adviser for violating an SEC trading rule when it purchased stock in a public offering of securities for six advisory clients after selling short the same stock for those clients during a restricted period under Rule 105 of Regulation M.  The SEC has long applied a strict liability standard to such cases.  The adviser agreed to cease and desist from committing or causing violations of Rule 105, and to pay a penalty of $250,000 without disgorgement.  The SEC’s order notes the adviser’s cooperation and remedial efforts, which may be one reason disgorgement of gains in the relevant private funds was not required as a part of the settlement.  Read more here.

Executive Order to Facilitate Investment by Retirement Plans in a Wider Range of Assets 

President Trump Signed an Executive Order designed to make it easier for retirement plans to invest in a wider range of assets, including cryptocurrency, private equity and real estate.  The Order states a combination of regulatory overreach and lawsuits has stifled investment innovation and largely relegated 401(k) and other defined-contribution retirement plan participants to limited and underperforming asset classes.  The Order is accordingly titled: “Democratizing Access to Alternative Assets for 401(k) Investors.”  Read more here.

Study Finds Turnover at Companies

Threatens Business Continuity

A study by McLean & Company finds voluntary turnover at companies continues to pose a serious risk to organizational performance.  The recent study finds organizations with low voluntary turnover (10% or below) were significantly more likely to report strong performance against their strategic objectives.  Yet many organizations continue to rely on ad hoc or informal assessments of employee flight risk, which lack the structure and accuracy needed to intervene early, leaving leaders unaware until it is too late.  McLean & Company's research emphasizes that while some turnover is expected, a large proportion may be anticipated and addressed with the right data and interventions.  The study includes suggestions for assessing and addressing turnover risk at companies.  Read more here.

Defense Contractor and Private Equity Firm Agree to Pay $1.75M to Resolve False Claims Act Liability Relating to Voluntary Self-Disclosure of Cybersecurity Violations

The Department of Justice announced a defense contractor and private equity (PE) company agreed to pay $1.75 million to resolve their liability under the False Claims Act for knowingly failing to comply with cybersecurity requirements in an Aero Turbine contract with the Department of the Air Force.  The action alleged the contractor failed to implement certain cybersecurity controls in National Institute of Standards and Technology (NIST) Special Publication (SP) 800-171 that, if not implemented, could lead to significant exploitation of the system or exfiltration of sensitive defense information.  In addition, the contractor and PE firm failed to control the flow of, and limit unauthorized access to, sensitive defense information by providing a software company based in Egypt with files containing such information.  The settlement notes companies’ cooperation with the government’s investigation.  Read more here.

SEC’s Division of Corporation Finance Issues Staff Statement on Liquid Staking Activities

The SEC’s Division of Corporation Finance issued a staff statement on certain liquid staking activities to provide greater clarity on the application of federal securities laws to crypto assets.  Liquid staking refers to the process of staking crypto assets through a software protocol or service provider and receiving a “liquid staking receipt token” to evidence the staker’s ownership of the staked crypto assets and any rewards that accrue to them.  The statement clarifies the Division’s view that, depending on the facts and circumstances, the liquid staking activities covered in the statement do not involve the offer and sale of securities within the meaning of the relevant provisions of the federal securities laws.  Read more here.

MSCI Announces Changes to Equity Indexes

According to a report by Reuters, MSCI will add 42 securities and delete 56 from its widely followed ACWI equity index.  All changes will be made as of the close of August 26, 2025.  The article notes nearly $17 trillion in assets were benchmarked to MSCI indexes at the end of 2024.  As of last June, there were $2 trillion in equity ETFs linked to its indexes.  As of July 31, the largest country weights in the emerging markets index were China with 29.2%, Taiwan with 19.5%, India with 16.9% and South Korea with 11%.  Read more here.

EFRAG Publishes Amended ESRS Exposure Drafts

The European Financial Reporting Advisory Group (EFRAG) has published the amended European Sustainability Reporting Standards (ESRS) Exposure Drafts as part of its Omnibus revision initiative.  These long-anticipated updates are intended to ease reporting burdens, clarify disclosure expectations, and enhance alignment with international sustainability frameworks. The revised Exposure Drafts, which cover all 12 ESRS, are open for public consultation until 29 September 2025.  The Drafts are accompanied by comprehensive amendment logs, new implementation guidance, and an updated glossary.  Read more here.

FiSolve Fall Roundtables to be Announced

Stay tuned for information relating to an upcoming roundtable this fall, to take place in New York City.

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