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On December 18, 2025, President Trump signed the annual defense bill, aptly named the National Defense Authorization Act for Fiscal Year 2026 (the NDAA), into law. Buried in the NDAA, beginning on page 2718, congressional lawmakers included the "Holding Foreign Insiders Accountable Act" (the HFIAA). The HFIAA for the first time imposes the reporting obligations under Section 16 of the U.S. Securities Exchange Act of 1934 (the Exchange Act) on directors and officers of Foreign Private Issuers (FPIs), including Canadian companies that satisfy their reporting obligations utilizing the U.S.-Canada Multijurisdictional Disclosure System.

What should a broker-dealer do when a customer's contact information no longer works? The law imposes responsibilities on broker-dealers in such situations. We expect the Securities and Exchange Commission (SEC), the Financial Industry Regulatory Authority (FINRA), and State securities regulators to have heightened interest and increased scrutiny over "orphaned" accounts, which are those where the designated representative relationship has ended or the client has become unresponsive. Recent SEC and FINRA actions and regulatory priorities focus on retail accounts, underscoring that firms must actively supervise these accounts, make diligent efforts to locate the customer, maintain escalation protocols, avoid charging fees for services not provided, and, if contact remains unsuccessful, transfer the abandoned property to the state. Failure to follow the rules governing orphaned accounts can expose a broker-dealer to significant sanctions.

The Commodity Futures Trading Commission (CFTC or Commission) announced a landmark regulatory initiative that enables certain digital assets to serve as collateral in derivatives markets. Acting Chairman Caroline D. Pham unveiled the Digital Assets Pilot Program through a trio of letters released on December 8, providing new guidance on the acceptance and use of tokenized collateral and withdrawing a prior staff advisory. Industry participants are characterizing the announcement as a pivotal moment for digital asset integration into regulated US derivatives markets. The announcement follows the enactment of the GENIUS Act in July 2025 and implements recommendations from the President's Working Group on Digital Asset Markets report.

Katten announced today that the firm represented Bitnomial Exchange in connection with the upcoming launch of the first listed leveraged spot cryptocurrency product in the United States. The launch marks a significant milestone in the evolution of the US digital asset market structure and reflects Bitnomial's continued leadership in building regulated pathways for crypto trading.

The New York Limited Liability Company Transparency Act (NY LLCTA) will become effective on January 1, 2026. At a high level, the NY LLCTA shares many of the key components of the federal Corporate Transparency Act and its implementing rules promulgated by the US Treasury Department's Financial Crimes Enforcement Network (FinCEN) (collectively, the CTA).