Minutes - October 8, 2020

A meeting of the State Securities Board was held remotely on October 8, 2020, 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; Marlene K. Sparkman, General Counsel; Emily Diaz, Assistant Director, Registration Division; Betsy Hodges, Assistant Director, Inspections and Compliance Division; Misty Smith, Assistant Director, Staff Services Division; Cheryn Netz, Assistant General Counsel; Tina Lawrence, Assistant Director, Enforcement Division; Shaun Yarroll, Assistant Director, Registration Division; Cristi Ochoa, Attorney, Inspections and Compliance Division; Robin Brady, IT, Staff Services Division; and Sonia Fergerson, Executive Assistant.  Also attending were Kim Lopez-Gonzales, Chica Cherry, and Christopher Smith.

Chair Kinney called the meeting to order at 10:01 a.m.

Minutes of the May 19, 2020, meeting were approved.

The Audit Committee reported on the Agency’s Internal Audit Report for Fiscal Year 2020, prepared by Garza/Gonzalez & Associates, and the Board reviewed the report.

The Board voted to publish for public comment the following new rule proposals:

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 Board received information on a prospective grant for $56,500 from the Investor Protection Trust for updating The Texas Investor Guide for 2021 and voted to preapprove that grant.

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 report on the Agency’s budget and performance measures.

The Commissioner gave a general update on Agency operations.

The Board retired to executive session at 11:16 a.m. to discuss the performance review of the Securities Commissioner pursuant to the exception granted by Section 551.074 of the Texas Government Code, Open Meetings Act.

Following the executive session, the Board reconvened the open meeting at 11:48 a.m. and noted their approval of the Commissioner’s job performance.

The Board then discussed possible times and dates for future Board Meetings and selected 10:00 a.m. on February 18, 2021, May 20, 2021, August 26, 2021, and October 28, 2021.

The meeting was then adjourned at 12:10 p.m.