SEC Warns Public Pension Funds About Inadequate Compliance Policies and Procedures Following Report of Investigation Into Insider Trading By Employees of the Retirement System of Alabama

  • The Retirement System of Alabama purchased stock in The Liberty Corporation based on information obtained in the course of providing debt financing to Liberty in connection with the acquisition of Liberty by a company controlled by the RIA.
  • The RIA had no compliance policies or procedures in place at the time of the insider trading, but agreed to institute such policies following the investigation.
  • The SEC wrote a Report of Investigation describing the matter, and used the occasion of the Report to remind pension funds that although they are generally exempt from the Investment Company Act and the Investment Advisers Act, they remain subject to the anti-fraud provisions of the federal securities laws and rules.

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