Mass. Cracks Down On Expert Networking Firms

Law360, New York (August 8, 2011, 7:01 PM EDT) -- Massachusetts securities regulators said Monday the state had adopted new rules to prevent the disclosure of material nonpublic information through investment advisers' use of expert networking firms, which have come under fire from federal and state officials.

The Massachusetts Securities Division regulations will require investment advisers to obtain written certification from expert networking firms that they have measures in place to prevent the disclosure of confidential information and that such information won't be disclosed. Even if the adviser obtains confidential information, the rules state that they...
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