Compliance Stuff

Colorado's landmark artificial intelligence law, the most comprehensive in the country, has been replaced before it ever took effect. After years of concern over the implications of Colorado's Concerning Consumer Protections in Interactions with AI Systems law, which was set to take effect on June 30, Gov. Jared Polis recently signed into law S.B. 26-189, a bill that repealed the Colorado AI law and replaced its broad "high-risk artificial intelligence system" framework with a narrower regime focused on automated decision-making technology, or ADMT, used in consequential decisions. S.B. 26-189 will apply to job applicants and employees who are residents of Colorado, in addition to "any individual whose access to, eligibility for, or opportunity in Colorado is evaluated in a consequential decision by a person doing business in Colorado." The Colorado AI law has been a source of concern for employers since it was enacted in 2024. Had the law gone into effect ...

Compensation is generally subject to federal income tax and FICA tax when compensation is actually paid to an employee. However, nonqualified deferred compensation (NQDC) may be subject to FICA taxation before federal income taxation under a FICA tax special timing rule. The scope of NQDC subject to FICA taxation is broad, including voluntary deferrals of salary, restricted stock units and performance stock units with deferral features, SERPs, and certain deferred bonuses. Understanding when FICA tax applies to NQDC, and how to take advantage of FICA tax timing rules, can help employers avoid errors when administering their NQDC arrangements. Below is a summary of the FICA tax special timing rule and our insights. FICA Tax The Internal Revenue Code imposes FICA tax on compensation employers pay to employees for services. FICA is comprised of two separate taxes: old-age, survivor, and disability insurance tax (OASDI) (commonly called the Social Security tax) and hospital insurance tax ...

  Two SEC enforcement actions from earlier this month, each including charges against a firm’s Chief Compliance Officer in their personal capacity, underscore the importance of maintaining accurate records and upholding transparency during regulatory examinations . While the cases differ in detail, both focus on allegations that the CCO provided misleading information to regulators during an exam—highlighting one of the principal ways that individual liability can arise.   Typically, CCOs are given the benefit of the doubt, but can face personal exposure when they (1) participate in the underlying misconduct, (2) fail entirely in their compliance duties, or (3) mislead regulators. These recent actions illustrate the third category. Case Summary: RIA Chief Compliance Officer Backdated and Fabricated Pre-Clearance Forms In July 2025, the SEC  settled charges  with the CCO of a formerly registered investment adviser for altering approximately 170 pre-clearance trading f...