Skip to main content

Basics of Mutual Funds and Other Registered Investment Companies 2018


Speaker(s): Bibb L. Strench, Chih-Pin Lu, Clifford E. Kirsch, Cynthia R. Beyea, David S. Royal, Edward Baer, Francis J. (Jay) Facciolo, Gregory N. Bressler, James C. Munsell, Laurin Blumenthal Kleiman, Lori A. Martin, Matthew Thornton, Michael Weiner, Rajib Chanda, Shannon Behara
Recorded on: May. 14, 2018
PLI Program #: 219169

JIM MUNSELL is a partner in Sidley’s New York office. He counsels investment advisers and investment funds in connection with a broad range of corporate, securities, derivatives and regulatory matters. Jim’s clients range from small, closely held start-up investment management businesses to the investment management divisions of global financial institutions. He was involved in the successful development and launch of the first commodity pool to be listed on a securities exchange in the United States and continues to work on innovative exchange-traded funds (ETFs). 

Jim is part of Sidley’s Investment Funds, Advisers and Derivatives practice team that has won numerous top awards as a provider of legal services to the private funds industry: two-time winner of Chambers and Partners’ “Investment Funds Team of the Year for the U.S.”; Institutional Investor’s Alpha magazine’s 2014 Alpha Awards top “onshore” (U.S.) law firm serving the hedge fund industry; four-time recipient of first-tier national rankings in the U.S. News – Best Lawyers “Best Law Firms” rankings for Private Funds/Hedge Funds Law, and Derivatives and Futures Law; and ranked in the top band for Hedge Funds by Chambers USA every year since 2008. Additionally, Jim is recognized in the 2013–2015 editions of The International Who’s Who of Private Funds and is recommended in The Legal 500 for mutual/registered funds and private equity funds. He is also a winner of an ETF Award, which highlights the outstanding performance and results achieved by corporate leaders. 

Jim is a member of the New York City Bar Association and served on the Committee on Futures and Derivatives Regulation from 2009–2012 and as the chairman of the CPO/CTA Subcommittee from 2010–2012. Additionally in the New York City Bar Association, Jim served as a member of the Committee on Investment Management Regulation from 2012–2015.

Jim received his J.D. from Fordham University, and his B.A. from Lawrence University.


Shannon joined ACA in 2005. As a Partner in the Boston office, she provides regulatory and compliance consulting services to investment companies, private funds, and investment advisers. She advises clients on designing, drafting, and implementing customized compliance programs. Shannon also performs mock examinations, procedural reviews, and customized forensic testing audits to evaluate compliance with federal securities laws. In her work, she specializes in the complexities of fixed-income markets and structured securities. More recently, Shannon has worked extensively with sponsors and sub-advisers of liquid alternative registered investment companies in understanding the complexities of the Investment Company Act of 1940 and its application to non-traditional investment types and methods.  Shannon also works with a number of business development companies.  As a prominent expert on compliance issues, she also speaks frequently at conferences and has provided content and comments to industry periodicals and publications.

Shannon began her regulatory career in 2001 as a Securities Compliance Examiner with the Boston District Office of the Securities and Exchange Commission. During her SEC tenure, she led or participated in examinations of investment companies, investment advisers, hedge funds, transfer agents, and variable insurance products. She also performed extensive work on several market-timing, late-trading, and directed-brokerage cases that involved close coordination with the SEC’s Division of Enforcement.

Prior to joining the SEC, Shannon served as a Senior High Yield Analyst for Bridge Information Systems. During her time at Bridge and its predecessors, she performed analytical pricing and covenant analysis on a wide variety of fixed-income issues, including asset-backed debt, U.S. and Euro medium-term notes, and investment-grade and high-yield corporate debt.

Shannon graduated from the University of Central Oklahoma with a Bachelor of Business Administration in Finance. She also holds a graduate certificate in Forensic Accounting from Northeastern University.


Overview

Bibb Strench is a partner in the Corporate Transactions & Securities practice group. He focuses on exchange-traded funds (ETFs), closed-end funds, mutual funds and investment advisers. He leads the firm’s award winning ETF practice, representing ETF issuers, ETF platforms and independent trustees of ETF issuers. 

Bibb provides advice on regulatory, compliance, entity formation, auditor independence, corporate governance and other issues related to the operation of the aforementioned businesses. He has experience with unique fund structures including funds with alternative investment strategies, faith-based restrictions and multi-tier levels.

Bibb began his career as a staff attorney in the Division of Investment Management of the U.S. Securities and Exchange Commission, where he witness the granting of the first ETF exemptive order. He has argued 1940 Act issues in federal and state courts, including the landmark mutual fund independent director case, Yacktman v. Carson, et al, and participated in the development of the Uniform Statutory Trust Entity Act.


Cliff Kirsch began his career at the U.S. Securities and Exchange Commission (SEC), became chief legal officer for one of the country’s largest dually- registered broker-dealer/advisers and then joined Sutherland (now Eversheds Sutherland) in 2006. He relies on his regulatory and in- house background and an up-to-date knowledge of regulatory developments to provide practical and innovative counsel to broker-dealers and investment advisers in the areas of securities regulation and compliance.

With more than 25 years of experience, Cliff regularly counsels clients on the design and distribution of investment products including wrap-fee programs and other advisory products, mutual funds, bank collective investment funds and insurance products. He also focuses on issues related to the design and implementation of compliance programs at financial services firms.

While at the SEC, Cliff received the Manuel F. Cohen Award, which recognizes younger lawyers who have displayed outstanding legal ability, integrity and judgment and he served as assistant director of the SEC's Division of Investment Management.

Cliff is a frequent speaker at industry conferences, and is the author and editor of two of the leading treatises in the broker-dealer and adviser arena: Broker-Dealer Regulation and Investment Adviser Regulation (published by the Practising Law Institute).

Cliff is also co-founder of the Julia Anne Kirsch Foundation, which seeks to serve the needs of disabled individuals and their families.

Experience

Eversheds Sutherland counsels a coalition of major life insurance companies on evolving state and federal regulations and other legal developments.

Eversheds Sutherland represents a coalition of major life insurance companies, which collectively account for more than 80% of the annuity business in the United States, in their efforts to affect the direction and details of various SEC, FINRA, CFTC, NAIC and state rule proposals and initiatives.

Eversheds Sutherland serves as outside counsel on broker-dealer and adviser regulatory issues for one of the largest independent broker-dealer networks in the country.  Eversheds Sutherland serves as regular primary outside counsel on broker-dealer and adviser regulatory issues for one of the largest independent broker-dealer networks in the country.

Eversheds Sutherland represents coalition of collective trust fund sponsors, advisers and other service providers.

Eversheds Sutherland serves as counsel to the Coalition of Collective Trust Funds. Among other things, Sutherland monitors and reports on legal and regulatory matters affecting collective trust funds.

Professional Activities

Member, New York City Bar Association

Faculty, FINRA Compliance Institute at The Wharton School of the University of Pennsylvania

Former Chair, FINRA Variable Products Committee

Former Board Member, National Society of Compliance Professionals


David Royal is currently the Chief Investment Officer and is actively involved in both the asset management business as well as all mutual fund activity at Thrivent Financial, including serving as president for a $55 billion mutual fund complex. Organized as a fraternal benefit society, Thrivent Financial is a Fortune 500 financial services company that offers insurance and investment products and currently has assets under management of over $136 billion (as of 12/13/18).

Previously, he was employed at Kirkland & Ellis LLP in Chicago as a Partner in the investment management group from April 2004 to June 2006. Prior to that, he was an Attorney at Skadden, Arps, Slate, Meagher & Flom LLP from 1997 to 2004.

David teaches Investment Management Law as an adjunct professor at the University of Minnesota's Law School.

David earned a B.A. from Yale College and a J.D. from Yale Law School.

 


Edward Baer is counsel in Ropes & Gray's investment management practice in San Francisco. His practice focuses on advising exchange-traded funds (ETFs), open- and closed-end investment companies, and their independent directors/trustees. He has deep experience in operational, governance, compliance, regulatory and business issues related to ETFs and other investment companies and asset managers. He also has experience advising clients on investments in cryptocurrencies, including bitcoin, ether and other coins and tokens, initial coin offerings (ICOs) and simple agreements for future tokens (SAFTs), cryptocurrency fund formation and related custody issues.

Prior to joining Ropes & Gray in 2016, Ed was managing director and senior counsel for the world’s largest asset manager, and also served as chief legal officer for the world’s largest ETF complex. In that role, he oversaw the full range of legal and compliance matters for over 300 ETFs, including index and active 1940 Act ETFs and non-1940 Act physical metals and futures-based commodities ETFs, with assets under management of approximately $800 billion. Ed and his team were responsible for all legal aspects of the operation of the ETF complex, including:

  • registration of ETFs under the 1933 Act and 1940 Act;
  • fund governance and board matters;
  • ·new ETF product development, including novel products such as a 1940 Act-registered commodity index ETF, a frontier markets ETF, currency and interest rate hedged ETFs and “smart beta” ETFs;
  • ETF exemptive relief and exchange listing and trading relief;
  • ETF creation and redemption activities; and
  • ETF distribution, marketing and index licensing.

Ed also advised on acquisitions and other strategic business matters, global valuation issues, and regulatory affairs, as well as on numerous other legal and compliance matters.

Prior to his in-house role, he held positions at two large law firms where he focused his practice on counseling clients on issues arising under the 1940 Act and advising mutual funds on organization, registration, operations, governance and regulatory matters.


Gregory N. Bressler serves as General Counsel of SunAmerica Asset Management, LLC and Chief Counsel for the AIG Consumer Distribution organization supporting the domestic retail distribution of Life & Retirement products.  Before joining SunAmerica in 2005, Mr. Bressler served as Director of U.S. Asset Management Compliance for Goldman Sachs Asset Management, L.P. and Deputy General Counsel for Credit Suisse Asset Management, LLC.  He began his legal career with Werner & Kennedy before joining Swidler Berlin Shereff Friedman, LLP.

Mr. Bressler has spoken at conferences in the financial services areas, including topics relating to private funds, registered investment companies, investment advisers and broker-dealers.  He has also written articles concerning these topics, including articles published in The Investment Lawyer and The Review of Securities & Commodities Regulation.

Mr. Bressler is a graduate of State University of New York at Binghamton, B.S., magna cum laude, and Vanderbilt University School of Law, J.D., where he served as Managing Associate Justice of the Moot Court Board and today serves on the Board of Advisors.


Laurin Blumenthal Kleiman is a global co-leader of Sidley’s Investment Funds, Advisers and Derivatives practice team. She advises a wide range of domestic and international investment funds and managers on regulatory, compliance and enforcement issues. Laurie is a frequent speaker on investment manager and fund regulation and compliance as well as on issues relating to the advancement of women in law.

Strong advocacy on behalf of her clients has earned Laurie acknowledgment in numerous industry publications, including Chambers USA, The Legal 500 and U.S. News & World Report. She is recognized in the area of Mutual Funds Law by The Best Lawyers in America®, with sources telling the publication: “Ms. Kleiman has been extremely professional and knowledgeable in her service to our firm. We trust her advice explicitly” and “[Laurie] is a true expert in her area, and remarkably commercial and practical.” Laurie was named to Crain’s New York Business’ inaugural “Leading Women Lawyers in New York City” list, where she was lauded as being among the 100 “trailblazing women” who have “found multiple paths to excellence” and have displayed “fierce determination, passion for the law, keen intelligence, and inspiring achievement.” Laurie also was named one of the “50 Leading Women in Hedge Funds” by the Hedge Fund Journal.

Laurie is an active proponent of advancement of women in the legal profession. She is firmwide co-chair of Sidley’s Committee on Retention and Promotion of Women, oversees the SidleyWomen initiative, and is chair of Sidley’s Executive Committee Task Force. Sidley has been recognized repeatedly for its groundbreaking women’s initiatives, including being named one of the “50 Best Law Firms for Women” by Working Mother Magazine nine times, receiving gold certification by the Women in Law Empowerment Forum (WILEF) seven times, and receiving, among others, “Most Inclusive Firm for Minority Women Lawyers” and “Outstanding Firm in Advancing Gender Diversity and Inclusion” honors from Chambers. Laurie is a frequent speaker on women’s issues, is a member of the WILEF advisory board and was named “2016 Gender Diversity Lawyer of the Year” by Chambers. She is also a member of the firm’s risk management committee.

Education

  • Vanderbilt University Law School (J.D., 1983, Editor, Vanderbilt Law Review)
  • Vanderbilt University (B.A., 1980)


Lori A. Martin is partner in the Securities and Litigation/Controversy departments of WilmerHale, where she is resident in the New York office. She handles regulatory proceedings and litigation on behalf of investment advisers, open and closed-end investment companies, hedge funds, and broker dealers offering investment advisory services. She was selected as the “Mutual Funds Law Lawyer of the Year” in the New York area by The Best Lawyers in America® 2014. Prior to joining WilmerHale, she was First Vice President and Assistant General Counsel of Merrill Lynch Investment Managers.

Her publications include: “Litigation Under the Investment Company Act of 1940,” Vol. 2, Chapter 26 Mutual Fund Regulation (Practicing Law Institute, 2017) (Clifford E. Kirsch, ed.); “Supreme Court Endorses Gartenberg, But It's Not the Same Old Standard,” WilmerHale Client Alert (April 5, 2010) (with Matthew A. Chambers); “Enforcement Trends and Themes,” Investment Management Institute (Practicing Law Institute, 2007-2012); “State Regulators and the Mutual Fund Industry,” 39 The Review o/Securities & Commodities Regulation 219 (Nov. 15, 2006) (with Cristina Alger); and “Emails and the Recordkeeping Obligations of Investment Advisers,” 12 The Investment Lawyer 16 (February 2005).

Ms. Martin's recent speeches include: “Excessive Fee Litigation, Contract Renewal and Share Class Developments,” panel presentation at the PLI Basics of Mutual Funds and Other Registered Investment Companies 2018 conference (New York, New York) (May 14, 2018); “Investment Management:  Enforcement and Litigation Trends,” panel presentation at the PLI Investment Management Institute 2018 conference (New York, New York) (April 30, 2018); “Key Legal and Regulatory Issues:  Asset Management,” panel presentation at the SIFMA Compliance & Legal Regional Seminar (Boston, Massachusetts) (June 7, 2017); and “Valuation Issues, SEC Examinations & Enforcement Actions,” panel presentation on a webinar co-sponsored by Deloitte & WilmerHale (June 19, 2013).

Ms. Martin graduated with honors from the University of Chicago School of Law in 1988, where she was a member of the University of Chicago Law Review. She graduated with honors from Wellesley College in 1985.


Michael Weiner is in-house counsel to Morgan Stanley Wealth Management and advises on the offering of mutual funds, ETFs, and other registered investment products on Firm brokerage and advisory platforms.  His duties include advising Morgan Stanley on share class selection issues, its economic arrangements with participating fund families, and other matters arising under the Investment Company Act of 1940.  Mr. Weiner also counsels Morgan Stanley on the registration, operation, and distribution of its proprietary unit investment trusts, the “Morgan Stanley Portfolios.”

Prior to joining Morgan Stanley, Mr. Weiner served as in-house counsel to AXA Equitable Funds Management Group, a mutual fund investment adviser with more than $100 billion in assets under management.  At AXA, his responsibilities ranged from fund registration to the annual negotiation process with the board of directors for the AXA-sponsored funds.  Mr. Weiner began his career in private practice with Milbank, Tweed, Hadley & McCloy, where he specialized in defending fund advisers from “excessive fee” claims brought under Section 36(b) of the 1940 Act.

Mr. Weiner is a member of the Investment Management Regulation Committee of the New York City Bar Association, has spoken at the Practising Law Institute on mutual fund regulation, and been published in the Investment Lawyer.  Mr. Weiner graduated order of the coif from Vanderbilt University Law School and Swarthmore College.


Professor Facciolo practiced for ten years as a transactional corporate attorney in several major New York City law firms before becoming a law professor.  Professor Facciolo is the Assistant Director of the Securities Arbitration Clinic at the St. John's University School of Law and teaches Corporate Finance and Regulation of Mutual Funds. As an adjunct professor, he also teaches Sales and Payment Systems, Securities Regulation and Federal Regulation of Mutual Funds at New York Law School. Finally, he developed and taught a course for several years on the Regulation of Securities Markets and Broker-dealers at Hofstra School of Law. He received his J.D. from Columbia Law School and is a former clerk for Justice Sidney M. Schreiber of the New Jersey Supreme Court.

Among his publications in the area of investment management are the following

Do I Have a Bridge for You: Fiduciary Duties and Financial Advice, 17 University of Pennsylvania Journal of Business Law 101 (2014).

Introduction to Symposium: Revolution in the Regulation of Financial Advice: The U.S., the U.K. and Australia, 87 St. John’s Law Review 297 (2013).

A Broker’s Duty of Best Execution in the Nineteenth and Early Twentieth Centuries, 26 Pace Law Review 155 (2005).

When Deference Becomes Abdication: Immunizing Widespread Broker-Dealer Practices from Judicial Review through the Possibility of SEC Oversight, 73 Mississippi Law Journal 1 (2003).

Co-author of Avoiding the Inevitable:  The Continuing Viability of State Law Claims in the Face of Primary Jurisdiction and Preemption Challenges under the Securities Exchange Act of 1934, 1995 Columbia Business Law Review 525. Cited in "Worth Reading" column of The National Law Journal.

Exculpatory Hedge Clauses in Investment Advisory Contracts: Developments since Heitmen Capital, The Investment Lawyer, February 2014.

Sub-Adviser Fee Litigation: Will Section 36(b) Acquire Some Teeth?, New York Law Journal, March 17, 2015, page 4.

New Wave of Cases Involving Investment Adviser Fees, New York Law Journal, October 4, 2013, page 4.

The Revolution in Investment Adviser Regulation, The Investment Lawyer, October 2011.

When Should a Broker-Dealer Be Treated as an Investment Adviser?, New York Law Journal, August 1, 2011, page 4.

Co-author of Order Flow Cases:  Jurisdiction, Preemption and Securities Laws, New York Law Journal, May 9, 1995, page 1.

Co-author of Double Jeopardy Issues in the Financial Sector, New York Law Journal, August 3, 1994, page 1; reprinted in 20 RICO Law Reporter 1139 (1994).


Rajib Chanda is a corporate attorney who helps private equity firms and other alternative asset managers develop investment products for individual and other retail investors. He is a partner at Simpson Thacher & Bartlett, which was named the Investment Funds Firm of the Year in 2018 by Chambers USA.

At Simpson Thacher, Rajib heads the firm's Registered Funds Practice. Rajib helps clients launch mutual funds, business development companies, closed-end funds, exchange-traded funds and permanent capital vehicles. He also advises on M&A transactions in the asset management industry (acquisitions, minority investments and joint ventures). Rajib's clients, among others, include all six of the major publicly-traded private equity firms (Apollo, Ares, Blackstone, Carlyle, KKR and Oaktree) on registered fund formation, transactional and/or regulatory matters.

The latest edition of Chambers USA reports that clients say that “he is exceptional” and that “he is responsive, commercial, and has the ability to be creative and think outside the box.” The latest edition of The Legal 500 says that he is “an industry thought leader who provides cutting edge advice on the most difficult questions.” He is one of only three registered funds attorneys in the United States designated as a “Market Leader” by IFLR 1000. Rajib also provides counsel to boards of registered funds, and was named Independent Counsel of the Year at the 2018 Mutual Fund Awards.

Rajib previously co-chaired Simpson Thacher's Diversity Committee, and currently serves as one of the firm's Hiring Partners and as the Administrative Partner for the Washington, DC office.

He is a graduate of Brown University, with honors, and Harvard Law School, cum laude, where he was Editor-in-Chief of the Harvard Negotiation Law Review.


Cynthia Beyea is a member of Eversheds Sutherland’s Financial Services Practice Group and focuses her practice on advising mutual funds, closed-end funds, exchange-traded funds, investment company boards of directors and investment advisers. Cynthia concentrates on issues involving the Investment Company Act of 1940, the Investment Advisers Act of 1940 and related federal securities laws.

Cynthia assists investment company clients with registration, reporting and disclosure requirements, as well as with fund governance and compliance matters. She also regularly advises clients with respect to Section 529 college savings plans. Cynthia is a member of the business law section of the American Bar Association and of the corporation, finance and securities law section of the District of Columbia Bar. She is a member of the Maryland and District of Columbia bars.

Cynthia earned her J.D. at George Washington University Law School, and earned her B.A., magna cum laude, from American University where she was a Phi Beta Kappa member.


Chih-Pin Lu is Chief Counsel for the Asset Management Group of Raymond James Financial, Inc., headquartered in St. Petersburg, Florida. Since joining the firm in 2007, he has dealt with corporate, regulatory, and compliance matters related to the firm’s institutional asset management, retail investment adviser, investment company, and hedge fund businesses and affiliates.  Mr. Lu is an active member of various industry workgroups and committees, and regularly speaks at industry conferences.  Prior to joining Raymond James, Mr. Lu was a securities transactions and litigation attorney in private practice, and Senior Counsel (Enforcement) with the U.S. Securities and Exchange Commission’s Southeast Regional Office. During his tenure with the SEC, he received an appointment as a Special Assistant United States Attorney. Formerly, he represented clients in complex financial fraud cases as an Assistant Federal Public Defender.  Mr. Lu graduated from Tufts University and received his law degree from Boston College Law School.


Matthew Thornton is an Assistant General Counsel for the Investment Company Institute, with responsibility for a wide range of legal issues affecting registered investment companies. Mr. Thornton’s primary areas of responsibility include valuation, liquidity, stress testing, corporate governance and proxy voting, advertising/social media, issues related to fixed income, anti–money laundering, target date funds, disclosure, and investment advisory matters. Before joining the Institute in 2014, he was an associate in Dechert LLP’s financial services group from 2005 to 2014. Before practicing law, Mr. Thornton held positions in the financial services industry at SunTrust Banks from 1998 to 2005 and Merrill Lynch from 1997 to 1998. Mr. Thornton is a Certified Financial Planner™. He received his BA in economics from the University of Notre Dame and his JD from Georgetown University Law Center.