Minutes - February 18, 2021

A meeting of the State Securities Board was held remotely on February 18, 2021, via telephone conference call, as authorized under the Texas Government Code, section 551.125, and Governor Abbott’s temporary suspension of certain provisions of the Texas Open Meetings Act requiring government officials and members of the public to be physically present at a specified meeting location.

Those present were: E. Wally Kinney, Chair; Miguel Romano, Jr., Member; Kenny Koncaba, Member; Robert Belt, Member; Melissa Tyroch, Member; Travis J. Iles, Securities Commissioner; Clinton Edgar, Deputy Commissioner; Tommy Green, Director, Inspections and Compliance Division; Derek Lauterjung, Director Staff Services Division; Joseph J. Rotunda, Director, Enforcement Division; Betsy Hodges, Assistant Director, Inspections and Compliance Division; Tina Lawrence, Assistant Director, Enforcement Division; Misty Smith, Assistant Director, Staff Services Division; Shaun Yarroll, Assistant Director, Registration Division; Cheryn Netz, Assistant General Counsel; Cristi Ochoa, Attorney, Inspections and Compliance Division; Robin Brady, IT, Staff Services Division; and Sonia Fergerson, Executive Assistant.   Also attending were Kim Lopez-Gonzales and Christopher Smith.

Chair Kinney called the meeting to order at 10:09 a.m.

Minutes of the October 8, 2020, meeting were approved.

Upon the recommendation of the Audit Committee, the Board voted to retain Garza/Gonzalez & Associates as the internal auditor for FY2021.

The Board voted to retain the current committee members, E. Wally Kinney and Robert Belt, to serve on the committee to work with the Board’s internal auditor, with Robert Belt to continue as Chair.

The Board voted to adopt the following proposed rules with the nonsubstantive changes to §109.4 and §109.5 recommended by the staff:

  1. Repeal of §109.15, Designated Matching Services.
  2. Repeal of Form 133.35, Application for Designation as Matching Service under §109.15.
  3. Amending §107.2, concerning definitions, to align the definitions relating to accredited investor and qualified institutional buyer with recent changes to those definitions by the Securities and Exchange Commission, reference the current Form D, and expand the definition of EFD System to include additional filings as permitted by Board rule.
  4. Amending §109.4, concerning securities registration exemption for sales to financial institutions and certain institutional investors, §109.5, concerning dealer registration exemption for sales to financial institutions and certain institutional investors, and §109.6, concerning investment adviser registration exemption for investment advice to financial institutions and certain institutional investors, to replace  detailed definitions relating to accredited investors and qualified institutional buyers with cross-references to definitions in §107.2, concerning definitions.

The Commissioner gave a report on the Agency’s budget and performance measures.

The Commissioner gave an update on the Agency’s legislative appropriations request and gave a report on what may be expected during the upcoming legislative session.

The Commissioner gave a general update on Agency operations.

The meeting was then adjourned at 10:57 a.m.