Sweden Gives Its Four Buffer Funds More Investing Flexibility

Swedish Parliament has given the nation’s top buffer fund for its state pension system the green light for more illiquid and alternative investments.

The legislature, known as the Riksdagen, passed a bill which would alter the investment rules for all four of Sweden’s AP systems, which have a collected $155.4 billion in assets under management.

The buffer funds, also known as additional pensions or AP, are essentially emergency savings vehicles that back up the pension system’s assets.

Ossian Ekdahl, AP1’s acting head of communication, told IPE.com that the move is “good for both current and future Swedish pensioners,” but would not comment on how and if the measure would immediately impact AP1’s investment portfolio.

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The move allows the four funds more flexibility with their illiquid and alternative investment decisions, and cuts the minimum allocation for interest-bearing securities to 20% from 30%.

It also eliminated the requirement that funds dedicate a piece of their assets to be managed externally.

The new law also requires funds to manage their assets with sustainable development in mind.

The changes will go into effect on January 1, 2019.

The only Parliament members that did not vote in favor of the bill last week were from the socialist left party, Vänsterpartiet.

Tags: AP1, AP2, AP3, AP4, Pension, Riskdagen, Sweden

The SEC has settled charges against professional boxer Floyd Mayweather Jr. and music producer DJ Khaled for failing to disclose payments they received for promoting investments in initial coin offerings (ICOs). It is the first time the SEC has leveled charges for touting violations involving ICOs.

The SEC charged Mayweather and Khaled for violating Section 17(b) of the Securities Act, which makes it unlawful for anyone to promote a security without fully disclosing that they are receiving compensation for such promotion, and the amount they are being paid.

According to the SEC’s cease and desist orders, Mayweather promoted three ICOs on his Instagram, Twitter, and Facebook accounts from July 2017 through September 2017 in exchange for approximately $300,000.

“You can call me Floyd Crypto Mayweather from now on,” read a post on Mayweather’s Twitter account. And in anInstagram post, he said he would make a large amount of money on another ICO. Neither accounts mentioned that he was being compensated for the endorsements.

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Khaled promoted an ICO that was being conducted by Miami-based Centra Tech, Inc. through social media posts on his Instagram and Twitter accounts for which he was paid $50,000. However, the SEC said Khaled did not disclose the fact or amount of consideration he was receiving from Centra.

“These cases highlight the importance of full disclosure to investors,” Stephanie Avakian, co-director of the SEC’s Enforcement Division, said in a release. “With no disclosure about the payments, Mayweather and Khaled’s ICO promotions may have appeared to be unbiased, rather than paid endorsements.”

Although neither Mayweather nor Khaled admitted nor denied the SEC’s charges, they both agreed to pay disgorgement, penalties, and interest. Mayweather agreed to pay $300,000 in disgorgement, a $300,000 penalty, and $14,775 in prejudgment interest. Khaled agreed to pay $50,000 in disgorgement, a $100,000 penalty, and $2,725 in prejudgment interest. Additionally, Mayweather agreed not to promote any securities, digital or otherwise, for three years, while Khaled agreed to a similar ban for two years.

In November of 2017, the SEC issued a public warning urging caution over celebrity-backed ICO endorsements, and encouraging investors to research potential investments rather than rely on endorsements from artists, sports figures, or other icons.

“Investors should be skeptical of investment advice posted to social media platforms, and should not make decisions based on celebrity endorsements,” said Steven Peikin, co-director of the SEC’s Enforcement Division. “Social media influencers are often paid promoters, not investment professionals, and the securities they’re touting, regardless of whether they are issued using traditional certificates or on the blockchain, could be frauds.”

Tags: Cryptocurrency, DJ Khaled, Floyd Mayweather Jr., ICO, SEC