Banc of America Securities LLC, et al.; Notice of Application and Temporary Order, 28291-28293 [E9-14006]

Download as PDF pwalker on PROD1PC71 with NOTICES Federal Register / Vol. 74, No. 113 / Monday, June 15, 2009 / Notices common control with, the other person. Applicants state that RBC is an affiliated person of each of the other Applicants within the meaning of section 2(a)(3) of the Act. Applicants state that the entry of the Injunction results in Applicants being subject to the disqualification provisions of section 9(a) of the Act. 2. Section 9(c) of the Act provides that the Commission shall grant an application for exemption from the disqualification provisions of section 9(a) if it is established that these provisions, as applied to the Applicants, are unduly or disproportionately severe or that the Applicants’ conduct has been such as not to make it against the public interest or the protection of investors to grant the exemption. Applicants have filed an application pursuant to section 9(c) seeking a temporary and permanent order exempting them and Covered Persons from the disqualification provisions of section 9(a) of the Act. 3. Applicants believe they meet the standards for exemption specified in section 9(c). Applicants state that the prohibitions of section 9(a) as applied to them would be unduly and disproportionately severe and that the conduct of the Applicants has been such as not to make it against the public interest or the protection of investors to grant the exemption from section 9(a). 4. Applicants state that the alleged conduct giving rise to the Injunction did not involve any of the Applicants acting in the capacity of investment adviser or subadviser to any Fund or in the capacity of principal underwriter for any open-end Fund. Applicants also state that none of the current or former directors, officers, or employees of the Fund Servicing Applicants had any knowledge of, or had any involvement in, the conduct alleged in the Complaint. Applicants further state that the personnel at RBC who were involved in the violations alleged in the Complaint have had no involvement in providing investment advisory, subadvisory or principal underwriting services to Funds and will not have any future involvement in such activities. 5. Applicants state that the inability to continue to provide investment advisory and subadvisory services to Funds and principal underwriting services to openend Funds would result in potential hardship for the Funds and their shareholders. Applicants state that they will, as soon as reasonably practical, distribute written materials, including an offer to meet in person to discuss the materials, to the boards of directors of the Funds (‘‘Boards’’) for which the Applicants serve as investment adviser, investment subadviser or principal underwriter, including the directors VerDate Nov<24>2008 16:47 Jun 12, 2009 Jkt 217001 who are not ‘‘interested persons,’’ as defined in section 2(a)(19) of the Act, of such Funds, and their independent legal counsel as defined in rule 0–1(a)(6) under the Act, relating to the circumstances that led to the Injunction, any impact on the Funds, and the application. Applicants state they will provide the Boards with all information concerning the Injunction and the application that is necessary for the Funds to fulfill their disclosure and other obligations under the federal securities laws. 6. Applicants also state that, if they were barred from providing services to Funds, the effect on their businesses and employees would be severe. Applicants state that they have committed substantial resources to establish an expertise in providing advisory and distribution services to Funds. Applicants further state that prohibiting them from providing such services would not only adversely affect their businesses, but would also adversely affect approximately 35 employees who are involved in those activities. 7. Applicants have not previously received an exemption under section 9(c) as the result of conduct that triggered section 9(a). Applicants’ Condition Applicants agree that any order granting the requested relief will be subject to the following condition: Any temporary exemption granted pursuant to the application shall be without prejudice to, and shall not limit the Commission’s rights in any manner with respect to, any Commission investigation of, or administrative proceedings involving or against, Covered Persons, including, without limitation, the consideration by the Commission of a permanent exemption from section 9(a) of the Act requested pursuant to the application or the revocation or removal of any temporary exemptions granted under the Act in connection with the application. Temporary Order The Commission has considered the matter and finds that Applicants have made the necessary showing to justify granting a temporary exemption. Accordingly, It is hereby ordered, pursuant to section 9(c) of the Act, that Applicants and any other Covered Persons are granted a temporary exemption from the provisions of section 9(a), solely with respect to the Injunction, subject to the condition in the application, from June 9, 2009, until the Commission takes PO 00000 Frm 00079 Fmt 4703 Sfmt 4703 28291 final action on their application for a permanent order. By the Commission. Florence E. Harmon, Deputy Secretary. [FR Doc. E9–13980 Filed 6–12–09; 8:45 am] BILLING CODE 8010–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. IC–28764; File No. 812–13662] Banc of America Securities LLC, et al.; Notice of Application and Temporary Order June 9, 2009. AGENCY: Securities and Exchange Commission. ACTION: Temporary order and notice of application for a permanent order under section 9(c) of the Investment Company Act of 1940 (‘‘Act’’). SUMMARY: Summary of Application: Applicants have received a temporary order exempting them from section 9(a) of the Act, with respect to an injunction entered against Banc of America Securities LLC (‘‘BAS’’) and Banc of America Investment Services, Inc. (‘‘BAI’’) on June 9, 2009 by the United States District Court for the Southern District of New York (‘‘Injunction’’) until the Commission takes final action on an application for a permanent order. Applicants also have applied for a permanent order. APPLICANTS: BAS, BAI, Columbia Management Advisors, LLC (‘‘CMA’’), Columbia Wanger Asset Management, LP (‘‘CWAM’’), Columbia Management Distributors, Inc. (‘‘CMDI’’), Banc of America Investment Advisors, Inc. (‘‘BAIA’’), Bank of America Capital Advisors LLC (‘‘BACA’’), U.S. Trust Hedge Fund Management, Inc. (‘‘USTHFM’’), Merrill Lynch, Pierce, Fenner & Smith, Incorporated (‘‘MLPFS’’), IQ Investment Advisors LLC (‘‘IQ’’), Roszel Advisors, LLC (‘‘Roszel’’), Nuveen Asset Management (‘‘NAM’’), Nuveen Investments Advisers Inc. (‘‘NIA’’), Nuveen Investments Institutional Services Group, LLC (‘‘ISG’’), Nuveen HydePark Group, LLC (‘‘Nuveen HydePark’’), NWQ Investment Management Company LLC (‘‘NWQ’’), Nuveen Investment Solutions, Inc. (‘‘NIS’’), Santa Barbara Asset Management, LLC (‘‘Santa Barbara’’), Symphony Asset Management LLC (‘‘Symphony’’), Tradewinds Global Investors, LLC (‘‘Tradewinds’’) and Winslow Capital Management, Inc. (‘‘Winslow’’, together with NAM, NIA, ISG, Nuveen HydePark, NWQ, NIS, E:\FR\FM\15JNN1.SGM 15JNN1 28292 Federal Register / Vol. 74, No. 113 / Monday, June 15, 2009 / Notices Santa Barbara, Symphony and Tradewinds, the ‘‘Nuveen Advisers’’), Nuveen Investments, LLC (‘‘Nuveen Investments’’), KECALP Inc. (‘‘KECALP’’) and Merrill Lynch Ventures, LLC (‘‘Ventures’’) (collectively, ‘‘Applicants’’).1 DATES: Filing Date: The application was filed on June 3, 2009. Applicants have agreed to file an amendment during the notice period, the substance of which is reflected in this notice. HEARING OR NOTIFICATION OF HEARING: An order granting the application will be issued unless the Commission orders a hearing. Interested persons may request a hearing by writing to the Commission’s Secretary and serving applicants with a copy of the request, personally or by mail. Hearing requests should be received by the Commission by 5:30 p.m. on July 6, 2009, and should be accompanied by proof of service on applicants, in the form of an affidavit or, for lawyers, a certificate of service. Hearing requests should state the nature of the writer’s interest, the reason for the request, and the issues contested. Persons who wish to be notified of a hearing may request notification by writing to the Commission’s Secretary. ADDRESSES: Secretary, U.S. Securities and Exchange Commission, 100 F Street, NE., Washington, DC 20549– 1090; Applicants: BAS, One Bryant Park, New York, NY 10036; BAI, CMA, BAIA, BACA, 100 Federal Street, Boston, MA 02110; CWAM, 227 West Monroe Street, Suite 3000, Chicago, IL 60606; CMDI, One Financial Center, Boston, MA 02110; USTHFM, 225 High Ridge Road, West Building, Stamford, CT 06905; MLPFS, IQ, KECALP, Ventures, North Tower, 4 World Financial Center, New York, NY 10080; Roszel, 1700 Merrill Lynch Drive, Pennington, NJ 08534; and the Nuveen Advisers and Nuveen Investments, 333 West Wacker Drive, Chicago, IL 60606. FOR FURTHER INFORMATION CONTACT: Emerson S. Davis, Senior Counsel, at 202–551–6868, or Julia Kim Gilmer, Branch Chief, at 202–551–6821 (Division of Investment Management, Office of Investment Company Regulation). The following is a temporary order and a summary of the application. The complete application may be obtained via the Commission’s Web site by searching for the file number, or an pwalker on PROD1PC71 with NOTICES SUPPLEMENTARY INFORMATION: 1 Applicants request that any relief granted pursuant to the application also apply to any other company of which BAS or BAI is or may become an affiliated person (together with the Applicants, the ‘‘Covered Persons’’). VerDate Nov<24>2008 16:47 Jun 12, 2009 Jkt 217001 applicant using the Company name box, at https://www.sec.gov/search/ search.htm or by calling (202) 551– 8090. Applicants’ Representations 1. BAS, an indirect wholly owned subsidiary of Bank of America Corporation (‘‘BAC’’), is a full service U.S. investment bank and brokerage firm that provides a wide range of investment banking, and financial advisory services to corporate, institutional and individual clients. BAS is registered as an investment adviser under the Investment Advisers Act of 1940 (‘‘Advisers Act’’) and is registered as a broker-dealer under the Securities Exchange Act of 1934 (‘‘Exchange Act’’). BAI is a wholly owned subsidiary of Bank of America, N.A. and also an indirect subsidiary of BAC. BAI is registered as an investment adviser under the Advisers Act and is registered as a broker-dealer under the Exchange Act. While BAS and BAI do not currently serve, and no existing company of which BAS or BAI is an affiliated person (other than the Applicants) currently serves, as investment adviser, depositor or principal underwriter for a registered investment company (‘‘RIC’’), or principal underwriter for any registered open-end investment company, registered investment trust (‘‘UIT’’) or face amount certificate company or employees’ securities companies (‘‘ESC’’, and together with RICs, the ‘‘Funds,’’ and such services, the ‘‘Fund Servicing Activities’’), each may do so in the future. CMA, CWAM, BAIA, BACA, USTHFM, IQ, Roszel, the Nuveen Advisers and KECALP are registered as investment advisers under the Advisers Act and provide investment advisory or subadvisory services to Funds. Ventures provides investment advisory services to an ESC. CMDI, MLPFS and Nuveen Investments are registered as broker-dealers under the Exchange Act and serve as principal underwriters for certain Funds. Nuveen Investments also serves as depositor to certain UITs. 2. On June 9, 2009, the United States District Court for the Southern District of New York entered a judgment, which included the Injunction, against BAS and BAI (‘‘Judgment’’) in a matter brought by the Commission.2 The Commission alleged in the complaint (‘‘Complaint’’) that BAS and BAI 2 Securities and Exchange Commission v. Banc of America Securities LLC and Banc of America Investment Services, Inc., Judgment against Banc of America Securities LLC and Banc of America Investment Services, Inc., 09 CIV 5170 (S.D.N.Y., entered June 9, 2009). PO 00000 Frm 00080 Fmt 4703 Sfmt 4703 violated section 15(c) of the Exchange Act in connection with the marketing and sale of auction rate securities (‘‘ARS’’). The Complaint alleged that BAS and BAI misled customers regarding the fundamental nature and increasing risk associated with ARS that they underwrote, marketed and sold. Without admitting or denying any of the allegations in the Complaint, except as to jurisdiction, BAS and BAI consented to the entry of the Judgment that included, among other things, the entry of the Injunction and certain undertakings to take various remedial actions for the benefit of purchasers of certain ARS. Applicants’ Legal Analysis 1. Section 9(a)(2) of the Act, in relevant part, prohibits a person who has been enjoined from engaging in or continuing any conduct or practice in connection with the purchase or sale of a security, or in connection with activities as an underwriter, broker or dealer, from acting, among other things, as an investment adviser or depositor of any registered investment company or a principal underwriter for any registered open-end investment company, registered unit investment trust, or registered face-amount certificate company. Section 9(a)(3) of the Act makes the prohibition in section 9(a)(2) applicable to a company, any affiliated person of which has been disqualified under the provisions of section 9(a)(2). Section 2(a)(3) of the Act defines ‘‘affiliated person’’ to include, among others, any person directly or indirectly controlling, controlled by, or under common control, with the other person. Applicants state that BAS and BAI are or may be considered affiliated persons of each of the other Applicants within the meaning of section 2(a)(3). Applicants state that, as a result of the Injunction, they would be subject to the prohibitions of section 9(a). 2. Section 9(c) of the Act provides that the Commission shall grant an application for exemption from the disqualification provisions of section 9(a) of the Act if it is established that these provisions, as applied to Applicants, are unduly or disproportionately severe or that the conduct of the Applicants has been such as not to make it against the public interest or the protection of investors to grant the exemption. Applicants have filed an application pursuant to section 9(c) seeking a temporary and permanent order exempting the Applicants and the other Covered Persons from the disqualification provisions of section 9(a). E:\FR\FM\15JNN1.SGM 15JNN1 pwalker on PROD1PC71 with NOTICES Federal Register / Vol. 74, No. 113 / Monday, June 15, 2009 / Notices 3. Applicants believe they meet the standards for exemption specified in section 9(c). Applicants state that the prohibitions of section 9(a) as applied to them would be unduly and disproportionately severe and that the conduct of Applicants has been such as not to make it against the public interest or the protection of investors to grant the requested exemption from section 9(a). 4. Applicants state that the conduct alleged in the Complaint did not involve any of the Applicants acting in their capacity as investment adviser, subadviser, depositor or principal underwriter for any of the Funds. Applicants also state that to the best of their knowledge, none of the current directors and officers of the Applicants (other than BAS and BAI) or their employees that engage in Fund Servicing Activities (or any other persons in such roles during the time period covered by the Complaint) participated in the conduct alleged in the Complaint to have constituted the violations that provide a basis for the Injunction. Applicants further state that any personnel at BAS and BAI who participated in the conduct alleged in the Complaint to have constituted the violations that provide a basis for the Injunction have had no, and will not have any future involvement in the Applicants’ Fund Servicing Activities. 5. Applicants state that the inability of the Applicants to engage in Fund Servicing Activities would result in potentially severe financial hardships for the Funds they serve and the Funds’ shareholders or unitholders. Applicants state that they will distribute written materials, including an offer to meet in person to discuss the materials, to the boards of directors of the Funds (the ‘‘Boards’’), including the directors who are not ‘‘interested persons,’’ as defined in section 2(a)(19) of the Act, of the Funds and their independent legal counsel as defined in rule 0–1(a)(6) under the Act, if any, regarding the Injunction, any impact on the Funds, and the application. Applicants state that they will provide the Boards with all information concerning the Injunction and the application that is necessary for the Funds to fulfill their disclosure and other obligations under the Federal securities laws. 6. Applicants also state that, if they were barred from providing Fund Servicing Activities to the Funds, the effect on their businesses and employees would be severe. Applicants state that they have committed substantial capital and resources to establishing an expertise in providing Fund Servicing Activities. Applicants VerDate Nov<24>2008 16:47 Jun 12, 2009 Jkt 217001 further state that prohibiting them from providing Fund Servicing Activities would not only adversely affect their businesses (except for BAI and BAS) but would also adversely affect their employees who are involved in Fund Servicing Activities. Applicants also state that disqualifying KECALP and Ventures from continuing to provide investment advisory services to ESCs is not in the public interest or in furtherance of the protection of investors and would frustrate the expectations of eligible employees who invest in ESCs. Applicants state that it would not be consistent with the purposes of the ESC provisions of the Act to require another entity not affiliated with Merrill Lynch & Co., Inc., or BAC to manage the ESCs. 7. Applicants state that several Applicants and certain of their affiliates have previously received orders under section 9(c), as described in greater detail in the application. Applicants’ Condition Temporary Order The Commission has considered the matter and finds that the Applicants have made the necessary showing to justify granting a temporary exemption. Accordingly, It is hereby ordered, pursuant to section 9(c) of the Act, that Applicants and any other Covered Persons are granted a temporary exemption from the provisions of section 9(a), solely with respect to the Injunction, subject to the condition in the application, from June 9, 2009, until the Commission takes final action on their application for a permanent order. By the Commission. Florence E. Harmon, Deputy Secretary. [FR Doc. E9–14006 Filed 6–12–09; 8:45 am] PO 00000 Frm 00081 Fmt 4703 Sfmt 4703 SECURITIES AND EXCHANGE COMMISSION [Release Nos. 33–9037A; 34–60032A; IC– 28757A; File No. 265–25] Investor Advisory Committee; Notice of Federal Advisory Committee Establishment; Correction In FR Doc. No. E9–13349, on page 27359 for Tuesday, June 9, 2009, the link for sending electronic comments to the Commission was incorrectly stated in two places. The correct link reads as follows: (https://www.sec.gov/rules/ other.shtml). Dated: June 9, 2009. Florence E. Harmon, Deputy Secretary. [FR Doc. E9–13934 Filed 6–12–09; 8:45 am] BILLING CODE 8010–01–P SECURITIES AND EXCHANGE COMMISSION Sunshine Act Meeting Applicants agree that any order granting the requested relief will be subject to the following condition: Any temporary exemption granted pursuant to the application shall be without prejudice to, and shall not limit the Commission’s rights in any manner with respect to, any Commission investigation of, or administrative proceedings involving or against, Covered Persons, including without limitation, the consideration by the Commission of a permanent exemption from section 9(a) of the Act requested pursuant to the application or the revocation or removal of any temporary exemptions granted under the Act in connection with the application. BILLING CODE 8010–01–P 28293 Notice is hereby given, pursuant to the provisions of the Government in the Sunshine Act, Public Law 94–409, that the Securities and Exchange Commission will hold a Closed Meeting on Friday, June 19, 2009 at 11 a.m. Commissioners, Counsel to the Commissioners, the Secretary to the Commission, and recording secretaries will attend the Closed Meeting. Certain staff members who have an interest in the matters also may be present. The General Counsel of the Commission, or his designee, has certified that, in his opinion, one or more of the exemptions set forth in 5 U.S.C. 552b(c)(3), (5), (7), 9(B) and (10) and 17 CFR 200.402(a)(3), (5), (7), 9(ii) and (10), permit consideration of the scheduled matters at the Closed Meeting. Commissioner Paredes, as duty officer, voted to consider the items listed for the Closed Meeting in a closed session. The subject matter of the Closed Meeting scheduled for Friday, June 19, 2009 will be: institution and settlement of injunctive actions; institution and settlement of administrative proceedings; and other matters related to enforcement proceedings. At times, changes in Commission priorities require alterations in the scheduling of meeting items. For further information and to ascertain what, if any, matters have been added, deleted or postponed, please contact: The Office of the Secretary at (202) 551–5400. E:\FR\FM\15JNN1.SGM 15JNN1

Agencies

[Federal Register Volume 74, Number 113 (Monday, June 15, 2009)]
[Notices]
[Pages 28291-28293]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E9-14006]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. IC-28764; File No. 812-13662]


Banc of America Securities LLC, et al.; Notice of Application and 
Temporary Order

June 9, 2009.
AGENCY: Securities and Exchange Commission.

ACTION: Temporary order and notice of application for a permanent order 
under section 9(c) of the Investment Company Act of 1940 (``Act'').

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SUMMARY: Summary of Application: Applicants have received a temporary 
order exempting them from section 9(a) of the Act, with respect to an 
injunction entered against Banc of America Securities LLC (``BAS'') and 
Banc of America Investment Services, Inc. (``BAI'') on June 9, 2009 by 
the United States District Court for the Southern District of New York 
(``Injunction'') until the Commission takes final action on an 
application for a permanent order. Applicants also have applied for a 
permanent order.

Applicants: BAS, BAI, Columbia Management Advisors, LLC (``CMA''), 
Columbia Wanger Asset Management, LP (``CWAM''), Columbia Management 
Distributors, Inc. (``CMDI''), Banc of America Investment Advisors, 
Inc. (``BAIA''), Bank of America Capital Advisors LLC (``BACA''), U.S. 
Trust Hedge Fund Management, Inc. (``USTHFM''), Merrill Lynch, Pierce, 
Fenner & Smith, Incorporated (``MLPFS''), IQ Investment Advisors LLC 
(``IQ''), Roszel Advisors, LLC (``Roszel''), Nuveen Asset Management 
(``NAM''), Nuveen Investments Advisers Inc. (``NIA''), Nuveen 
Investments Institutional Services Group, LLC (``ISG''), Nuveen 
HydePark Group, LLC (``Nuveen HydePark''), NWQ Investment Management 
Company LLC (``NWQ''), Nuveen Investment Solutions, Inc. (``NIS''), 
Santa Barbara Asset Management, LLC (``Santa Barbara''), Symphony Asset 
Management LLC (``Symphony''), Tradewinds Global Investors, LLC 
(``Tradewinds'') and Winslow Capital Management, Inc. (``Winslow'', 
together with NAM, NIA, ISG, Nuveen HydePark, NWQ, NIS,

[[Page 28292]]

Santa Barbara, Symphony and Tradewinds, the ``Nuveen Advisers''), 
Nuveen Investments, LLC (``Nuveen Investments''), KECALP Inc. 
(``KECALP'') and Merrill Lynch Ventures, LLC (``Ventures'') 
(collectively, ``Applicants'').\1\
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    \1\ Applicants request that any relief granted pursuant to the 
application also apply to any other company of which BAS or BAI is 
or may become an affiliated person (together with the Applicants, 
the ``Covered Persons'').

DATES: Filing Date: The application was filed on June 3, 2009. 
Applicants have agreed to file an amendment during the notice period, 
---------------------------------------------------------------------------
the substance of which is reflected in this notice.

Hearing or Notification of Hearing: An order granting the application 
will be issued unless the Commission orders a hearing. Interested 
persons may request a hearing by writing to the Commission's Secretary 
and serving applicants with a copy of the request, personally or by 
mail. Hearing requests should be received by the Commission by 5:30 
p.m. on July 6, 2009, and should be accompanied by proof of service on 
applicants, in the form of an affidavit or, for lawyers, a certificate 
of service. Hearing requests should state the nature of the writer's 
interest, the reason for the request, and the issues contested. Persons 
who wish to be notified of a hearing may request notification by 
writing to the Commission's Secretary.

ADDRESSES: Secretary, U.S. Securities and Exchange Commission, 100 F 
Street, NE., Washington, DC 20549-1090; Applicants: BAS, One Bryant 
Park, New York, NY 10036; BAI, CMA, BAIA, BACA, 100 Federal Street, 
Boston, MA 02110; CWAM, 227 West Monroe Street, Suite 3000, Chicago, IL 
60606; CMDI, One Financial Center, Boston, MA 02110; USTHFM, 225 High 
Ridge Road, West Building, Stamford, CT 06905; MLPFS, IQ, KECALP, 
Ventures, North Tower, 4 World Financial Center, New York, NY 10080; 
Roszel, 1700 Merrill Lynch Drive, Pennington, NJ 08534; and the Nuveen 
Advisers and Nuveen Investments, 333 West Wacker Drive, Chicago, IL 
60606.

FOR FURTHER INFORMATION CONTACT: Emerson S. Davis, Senior Counsel, at 
202-551-6868, or Julia Kim Gilmer, Branch Chief, at 202-551-6821 
(Division of Investment Management, Office of Investment Company 
Regulation).

SUPPLEMENTARY INFORMATION: The following is a temporary order and a 
summary of the application. The complete application may be obtained 
via the Commission's Web site by searching for the file number, or an 
applicant using the Company name box, at https://www.sec.gov/search/search.htm or by calling (202) 551-8090.

Applicants' Representations

    1. BAS, an indirect wholly owned subsidiary of Bank of America 
Corporation (``BAC''), is a full service U.S. investment bank and 
brokerage firm that provides a wide range of investment banking, and 
financial advisory services to corporate, institutional and individual 
clients. BAS is registered as an investment adviser under the 
Investment Advisers Act of 1940 (``Advisers Act'') and is registered as 
a broker-dealer under the Securities Exchange Act of 1934 (``Exchange 
Act''). BAI is a wholly owned subsidiary of Bank of America, N.A. and 
also an indirect subsidiary of BAC. BAI is registered as an investment 
adviser under the Advisers Act and is registered as a broker-dealer 
under the Exchange Act. While BAS and BAI do not currently serve, and 
no existing company of which BAS or BAI is an affiliated person (other 
than the Applicants) currently serves, as investment adviser, depositor 
or principal underwriter for a registered investment company (``RIC''), 
or principal underwriter for any registered open-end investment 
company, registered investment trust (``UIT'') or face amount 
certificate company or employees' securities companies (``ESC'', and 
together with RICs, the ``Funds,'' and such services, the ``Fund 
Servicing Activities''), each may do so in the future. CMA, CWAM, BAIA, 
BACA, USTHFM, IQ, Roszel, the Nuveen Advisers and KECALP are registered 
as investment advisers under the Advisers Act and provide investment 
advisory or subadvisory services to Funds. Ventures provides investment 
advisory services to an ESC. CMDI, MLPFS and Nuveen Investments are 
registered as broker-dealers under the Exchange Act and serve as 
principal underwriters for certain Funds. Nuveen Investments also 
serves as depositor to certain UITs.
    2. On June 9, 2009, the United States District Court for the 
Southern District of New York entered a judgment, which included the 
Injunction, against BAS and BAI (``Judgment'') in a matter brought by 
the Commission.\2\ The Commission alleged in the complaint 
(``Complaint'') that BAS and BAI violated section 15(c) of the Exchange 
Act in connection with the marketing and sale of auction rate 
securities (``ARS''). The Complaint alleged that BAS and BAI misled 
customers regarding the fundamental nature and increasing risk 
associated with ARS that they underwrote, marketed and sold. Without 
admitting or denying any of the allegations in the Complaint, except as 
to jurisdiction, BAS and BAI consented to the entry of the Judgment 
that included, among other things, the entry of the Injunction and 
certain undertakings to take various remedial actions for the benefit 
of purchasers of certain ARS.
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    \2\ Securities and Exchange Commission v. Banc of America 
Securities LLC and Banc of America Investment Services, Inc., 
Judgment against Banc of America Securities LLC and Banc of America 
Investment Services, Inc., 09 CIV 5170 (S.D.N.Y., entered June 9, 
2009).
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Applicants' Legal Analysis

    1. Section 9(a)(2) of the Act, in relevant part, prohibits a person 
who has been enjoined from engaging in or continuing any conduct or 
practice in connection with the purchase or sale of a security, or in 
connection with activities as an underwriter, broker or dealer, from 
acting, among other things, as an investment adviser or depositor of 
any registered investment company or a principal underwriter for any 
registered open-end investment company, registered unit investment 
trust, or registered face-amount certificate company. Section 9(a)(3) 
of the Act makes the prohibition in section 9(a)(2) applicable to a 
company, any affiliated person of which has been disqualified under the 
provisions of section 9(a)(2). Section 2(a)(3) of the Act defines 
``affiliated person'' to include, among others, any person directly or 
indirectly controlling, controlled by, or under common control, with 
the other person. Applicants state that BAS and BAI are or may be 
considered affiliated persons of each of the other Applicants within 
the meaning of section 2(a)(3). Applicants state that, as a result of 
the Injunction, they would be subject to the prohibitions of section 
9(a).
    2. Section 9(c) of the Act provides that the Commission shall grant 
an application for exemption from the disqualification provisions of 
section 9(a) of the Act if it is established that these provisions, as 
applied to Applicants, are unduly or disproportionately severe or that 
the conduct of the Applicants has been such as not to make it against 
the public interest or the protection of investors to grant the 
exemption. Applicants have filed an application pursuant to section 
9(c) seeking a temporary and permanent order exempting the Applicants 
and the other Covered Persons from the disqualification provisions of 
section 9(a).

[[Page 28293]]

    3. Applicants believe they meet the standards for exemption 
specified in section 9(c). Applicants state that the prohibitions of 
section 9(a) as applied to them would be unduly and disproportionately 
severe and that the conduct of Applicants has been such as not to make 
it against the public interest or the protection of investors to grant 
the requested exemption from section 9(a).
    4. Applicants state that the conduct alleged in the Complaint did 
not involve any of the Applicants acting in their capacity as 
investment adviser, sub-adviser, depositor or principal underwriter for 
any of the Funds. Applicants also state that to the best of their 
knowledge, none of the current directors and officers of the Applicants 
(other than BAS and BAI) or their employees that engage in Fund 
Servicing Activities (or any other persons in such roles during the 
time period covered by the Complaint) participated in the conduct 
alleged in the Complaint to have constituted the violations that 
provide a basis for the Injunction. Applicants further state that any 
personnel at BAS and BAI who participated in the conduct alleged in the 
Complaint to have constituted the violations that provide a basis for 
the Injunction have had no, and will not have any future involvement in 
the Applicants' Fund Servicing Activities.
    5. Applicants state that the inability of the Applicants to engage 
in Fund Servicing Activities would result in potentially severe 
financial hardships for the Funds they serve and the Funds' 
shareholders or unitholders. Applicants state that they will distribute 
written materials, including an offer to meet in person to discuss the 
materials, to the boards of directors of the Funds (the ``Boards''), 
including the directors who are not ``interested persons,'' as defined 
in section 2(a)(19) of the Act, of the Funds and their independent 
legal counsel as defined in rule 0-1(a)(6) under the Act, if any, 
regarding the Injunction, any impact on the Funds, and the application. 
Applicants state that they will provide the Boards with all information 
concerning the Injunction and the application that is necessary for the 
Funds to fulfill their disclosure and other obligations under the 
Federal securities laws.
    6. Applicants also state that, if they were barred from providing 
Fund Servicing Activities to the Funds, the effect on their businesses 
and employees would be severe. Applicants state that they have 
committed substantial capital and resources to establishing an 
expertise in providing Fund Servicing Activities. Applicants further 
state that prohibiting them from providing Fund Servicing Activities 
would not only adversely affect their businesses (except for BAI and 
BAS) but would also adversely affect their employees who are involved 
in Fund Servicing Activities. Applicants also state that disqualifying 
KECALP and Ventures from continuing to provide investment advisory 
services to ESCs is not in the public interest or in furtherance of the 
protection of investors and would frustrate the expectations of 
eligible employees who invest in ESCs. Applicants state that it would 
not be consistent with the purposes of the ESC provisions of the Act to 
require another entity not affiliated with Merrill Lynch & Co., Inc., 
or BAC to manage the ESCs.
    7. Applicants state that several Applicants and certain of their 
affiliates have previously received orders under section 9(c), as 
described in greater detail in the application.

Applicants' Condition

    Applicants agree that any order granting the requested relief will 
be subject to the following condition:
    Any temporary exemption granted pursuant to the application shall 
be without prejudice to, and shall not limit the Commission's rights in 
any manner with respect to, any Commission investigation of, or 
administrative proceedings involving or against, Covered Persons, 
including without limitation, the consideration by the Commission of a 
permanent exemption from section 9(a) of the Act requested pursuant to 
the application or the revocation or removal of any temporary 
exemptions granted under the Act in connection with the application.

Temporary Order

    The Commission has considered the matter and finds that the 
Applicants have made the necessary showing to justify granting a 
temporary exemption.
    Accordingly,
    It is hereby ordered, pursuant to section 9(c) of the Act, that 
Applicants and any other Covered Persons are granted a temporary 
exemption from the provisions of section 9(a), solely with respect to 
the Injunction, subject to the condition in the application, from June 
9, 2009, until the Commission takes final action on their application 
for a permanent order.

    By the Commission.
Florence E. Harmon,
Deputy Secretary.
[FR Doc. E9-14006 Filed 6-12-09; 8:45 am]
BILLING CODE 8010-01-P
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