Senate Democrats Want SEC, CFTC Funding Restored

Senate Democrats late on Friday unveiled their version of a federal budget that restores funding for the Securities and Exchange Commission and the Commodity Futures Trading Commission to the full levels proposed by the president: $1.26 billion and $286 million, respectively, the Deal Pipeline reported yesterday. On Feb. 19, the House Republicans approved a plan that cut more than $60 billion from Obama's budget, slashing money for health reform, the Environmental Protection Agency, student aid and public broadcasting, along with money for the SEC and the CFTC. The Republican plan would fund the SEC and CFTC budgets at $1.1 billion and $186 million respectively, levels that would force both agencies to cut back on staff and technology at the same time they are assuminig their new Dodd-Frank Act responsibilities. Republicans also moved to bar the Obama administration from using czars to run various programs including the Troubled Asset Relief Program

SECURITIES RULING LIMITS CLAIMS OF FRAUD

The U.S. Supreme Court has given multinational companies a powerful new legal defense against fraud claims made by some of their investors, the Wall Street Journal reported today. The weapon for companies grows out of a June ruling that limits fraud claims in U.S. courts by private investors who bought shares on foreign stock exchanges. The Supreme Court decided that Australian shareholders who had purchased stock overseas in an Australian bank could not bring securities-fraud claims in a U.S. court. In order to avoid "incompatibility with the applicable laws of other countries," U.S. securities laws should govern only domestic stock purchases, the court concluded. The ruling means investors such as U.S. public pension funds could see limited recoveries in a number of pending securities actions. Judges have been interpreting the ruling in Morrison v. National Australia Bank Ltd. as preventing fraud claims in U.S. courts by any investor—either from the U.S. or abroad—who purchased shares on foreign exchanges.