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FMG Law Blog Line

Archive for October, 2012

Protecting Corporate Directors and Officers in Uncertain Times

Posted on: October 1st, 2012

By Kelly Morrison

Georgia’s wave of bank closures following the subprime mortgage crisis gave this state the dubious distinction of first place, with a whopping 70 banking institutions (and counting) folding under the weight of the financial crisis.

While it may be difficult to find a silver lining in a failure rate upwards of 25 percent, the resulting litigation has offered some positive opportunities in the form of clarified business judgment standards, as well as providing motivation for planning critical components of a comprehensive executive protection program that was not a priority during prosperous times. (more…)

Have You Filed Federal Reports for Your Employees?

Posted on: October 1st, 2012

By Ben Mathis

For many employers, the deadline to file various reports to Federal agencies regarding their employees was September 30th. This includes filings for EEO-1, the Employer Information Report, and the Veterans Employment Report, commonly known as the VETS-100 or VETS-100A. The EEO-1 filing requirement applies to private employers with 100 or more employees, as well as certain Federal government contractors with 50 or more employees. The filing includes delineating an employer’s work force by job categories and race, ethnicity, and sex. The EEOC has an online filing system, which may be found at (more…)

FINRA Clarifies “Know Your Customer” and “Suitability” Rules

Posted on: October 1st, 2012

By Joyce Mocek

FINRA Rule 2090, effective July 9, 2012, has streamlined and replaced the former NASD Rule 405, the “Know Your Customer” standard. The new rule contains a “reasonable diligence” standard, compared to the old rule requirement of “use due diligence.” Rule 2090 provides that “Every member shall use reasonable diligence, in regard to opening and maintenance of every account, to know (and retain) the essential facts concerning every customer and concerning the authority of each person acting on behalf of such customer.” “Essential facts” are now defined. The new Rule places additional obligations on member firms to not only comply with the “Know Your Customer” rule when opening an account, but also in maintaining an account. (more…)

California Becomes Third State to Limit Access to Employees’ Social Media Accounts

Posted on: October 1st, 2012

By: David Cole

On Thursday, Governor Jerry Brown signed a new law that significantly limits when California employers may ask employees and job applicants for social media information.  Under the new law, an employer cannot require or request an employee or job applicant to disclose his username or password, access a social media account in front of the employer, or share any social media content with the employer.  However, there is an exception that allows an employer to ask an employee to divulge social media that is reasonably believed to be relevant to an investigation of allegations of employee misconduct or employee violation of applicable laws and regulations, provided that the social media is used solely for purposes of that investigation or a related proceeding.  The new law takes effect January 1, 2013.

With this new law, California joins Maryland and Illinois as the first states to have laws restricting employer access to employees’ social media accounts.  Fittingly, Governor Brown announced the new law via Twitter, Facebook, Google+, LinkedIn, and MySpace, saying that this law, and a companion law that establishes a similar privacy policy for postsecondary education students, will “protect Californians from unwarranted invasions of their social media accounts.”