In depth

September

• SEC Approves Generic Listing Standards for Commodity-Based Trust Shares: The SEC has approved rule changes by three national securities exchanges to adopt generic listing standards for exchange-traded products (ETPs) holding spot commodities, including digital assets. This streamlines the process by allowing exchanges to list and trade Commodity-Based Trust Shares without filing individual rule changes under Section 19(b) of the Exchange Act. Chairman Paul S. Atkins emphasized that the move fosters innovation and investor choice, while Division Director Jamie Selway noted it enhances regulatory clarity and investor protection through a rules-based framework.
• CFTC and SEC Extend Form PF Compliance Date to Oct. 1, 2026: The CFTC and the SEC each voted to further extend the date for investment advisers to comply with amendments to Form PF to October 1, 2026. Amendments to Form PF (the confidential reporting form used by certain private fund advisers) were adopted in February 2024, and the original compliance date was March 12, 2025. The compliance date was previously extended to June 12, followed by the current extension to October 1; this further extension is expected to provide time to complete a substantive review of Form PF in accordance with a Presidential Memorandum and take any further appropriate actions, which may include proposing new amendments to Form PF. It seems increasingly likely that compliance with the amended Form PF will not be required unless and until amendments are made.
• CARB issues preliminary list of companies deemed to be in scope under SB 253/261: On September 24, the California Air Resources Board (CARB) released a preliminary list of entities that may be subject to climate disclosure laws SB 253 and SB 261. The list, based on business registration and proprietary revenue data, has notable flaws—including outdated information, unclear revenue calculations, and duplicate or inconsistent entries. CARB emphasized that the list is not definitive and should not be used as the sole basis for determining compliance. Companies are advised to independently evaluate their obligations under the laws, especially since key terms like "revenues" and "doing business in California" remain ambiguous. Entities that believe they are misclassified can submit feedback via CARB's survey tool, though its impact is uncertain. Draft regulations are expected soon, but it's unclear whether they will resolve these issues. As federal deregulation continues, expect states with active securities regulatory programs to respond by ramping up regulatory efforts.
• SEC Approves Texas Stock Exchange: The SEC has approved the Texas Stock Exchange (TXSE) to operate as a national securities exchange, marking the first such approval in decades and introducing new competition to US markets. TXSE, based in Dallas, has built a modern trading platform designed for speed and flexibility and plans to start trading and listings in 2026. The exchange aims to attract corporate issuers and ETP sponsors by offering transparent, issuer-friendly solutions and reducing the costs of going and staying public, while maintaining high standards. Backed by major financial institutions and industry leaders, TXSE positions itself as the most well-capitalized equities exchange ever approved, with a mission to reverse the decline in US public companies and strengthen Texas as a hub for capital markets. There is a strong foundation in Texas to suggest the TXSE may find success, but it remains to be seen whether the TXSE will directly compete with the NYSE or if it will operate primarily as a regional and/or specialized exchange.

October

• SIFMA Urges SEC to Modernize Recordkeeping Rules to Reduce Compliance Burden and Preserve Investor Protection: SIFMA and its Asset Management Group have called on the SEC to update outdated communications and recordkeeping rules for financial firms, arguing that current regulations—such as Exchange Act Rules 17a-4 and 18a-6 and Advisers Act Rule 204-2(a)(7)—are overly broad, impose strict liability, and overlook firms' good-faith compliance efforts. Citing recent enforcement actions over off-channel communications that led to over USD 2.2 billion in penalties, SIFMA proposed reforms to reduce unnecessary burdens while maintaining investor protection. Key recommendations include limiting retention to substantive client communications, establishing a compliance safe harbor, harmonizing retention periods to three years, and eliminating obsolete third-party undertakings. The group also emphasized preserving supervisory responsibilities without expanding retention obligations and submitted draft amendments to support its proposals. While not a certainty, such modernization efforts have a higher chance of success under the Atkins SEC.
• FDIC Unveils Sweeping Reforms to Strengthen Large-Bank Resolution Framework: FDIC Acting Chair Travis Hill has outlined a comprehensive plan to revamp the agency's approach to resolving large bank failures, drawing on lessons from the 2023 banking crisis. Key reforms include removing the bridge bank requirement under the Insured Depository Institution (IDI) Rule, prioritizing weekend sales to preserve franchise value, and aligning the IDI framework with Dodd-Frank Title I. The FDIC is also streamlining its bidding process to enable faster, more competitive resolutions, introducing pre-qualification for nonbank bidders and enhancing its least-cost test model for rapid bid evaluation. Additional efforts focus on boosting liquidity and systemic resilience, such as securitizing assets from failed institutions in partnership with the Federal Financing Bank and reducing reliance on costly Federal Reserve borrowing. The agency is also addressing cross-border bail-in challenges and promoting global coordination through the Financial Stability Board to improve preparedness for future large-bank failures. Easing the process for nonbank bidders is an interesting development that may provide additional competition for traditional bidders and create efficiencies in the process.
• Federal Regulators Withdraw Climate Risk Guidance for Large Banks: The OCC, Federal Reserve, and FDIC have jointly rescinded their 2023 interagency guidance on managing climate-related financial risks for institutions with over USD 100 billion in assets. The original framework encouraged banks to integrate climate risk into governance and risk management practices. Regulators now argue that the guidance is unnecessary and may divert attention from other material risks already covered under existing safety and soundness standards. The OCC had previously exited the initiative in March 2025. While the rescission removes the formal framework, it does not prohibit banks from considering climate risks. Institutions remain responsible for maintaining robust risk management processes for all material risks, including emerging ones, under current regulatory requirements.
• FinCEN and Regulators Ease SAR Filing Burden with New Compliance Guidance: On October 9, 2025, FinCEN and federal banking regulators released updated FAQs to help financial institutions reduce the compliance burden associated with filing Suspicious Activity Reports (SARs). The guidance clarifies that transactions near the USD 10,000 Currency Transaction Report (CTR) threshold do not automatically warrant an SAR, and institutions are not required to conduct separate post-SAR reviews to confirm continued suspicious activity. Instead, firms may rely on risk-based monitoring policies. The FAQs also extend the timeline for filing continuing activity SARs to 150 days and confirm that institutions are not legally obligated to document decisions not to file an SAR—though brief internal notes may be appropriate. These updates reflect a broader shift toward streamlining BSA/AML compliance and focusing on high-value intelligence for law enforcement, moving away from a rigid "zero-tolerance" approach. While legal requirements remain unchanged, the new guidance signals evolving supervisory expectations and will prompt updates to examination materials, including the FFIEC BSA/AML Manual. These updates are consistent with other regulatory changes to encourage a principles-based approach to regulation rather than requiring compliance with objective standards. We expect this trend to continue.
• SEC Grants Conditional Relief for Crypto Custody by State-Chartered Trust Companies: The SEC staff has issued no-action relief allowing advisers and registered funds to use state-chartered trust companies as custodians for crypto assets under the 1940 Act and the Advisers Act custody rule—provided certain conditions are met. This clarifies longstanding uncertainty over whether such entities qualify as "banks" under these statutes. Acknowledging their growing role in digital asset custody and increasing regulatory oversight, the SEC emphasized that the relief is fact-specific and contingent on strong investor protection measures. Key conditions include thorough initial and annual due diligence, verified safeguarding policies, audited financials and SOC-1 reports, clear risk disclosures, and written custody agreements ensuring asset segregation and prohibiting unauthorized use. The principles-based approach focuses on governance and controls rather than prescriptive technology standards. While this provides greater clarity for digital asset strategies, questions around self-custody remain unresolved, and formal amendments to custody rules are expected in the future. This is welcome clarification. As momentum on passing the CLARITY Act decreases in the Senate, SEC and CFTC No-Action Relief and guidance will only become more critical until comprehensive regulation is in place.