Index Proxy Polling,” an easy way for shareholders to convey their preferences on proxy votes for S&P 500 companies. The aim is to demonstrate how shareholders in an index fund could express their opinions.

So far, only about 100 investors have participated, said Mike Willis, the fund manager, and current S.E.C. regulations require him to make the final voting decisions on behalf of the fund. But he said he hoped the S.E.C. would eventually allow him “to move to real shareholder democracy and go to pass-through voting, in which the shareholders say what they want and we just cast the vote for them.”

I commend Mr. Willis for his innovative approach, but note that this is not a typical index fund. It is an equal-weighted version of the S&P 500: It gives equal emphasis to big and small companies, so it may underperform the market when giants like Apple boom, and do better than the standard index when smaller companies excel. Its expense ratio of 0.25 percent is reasonable but not as low as some of the giant funds.

If experiments like this catch on, they could help to move the markets closer to something resembling shareholder democracy. But legislators and regulators — people like Mr. Coates and Mr. Gensler — will need to weigh in, too, if we are to avert a future in which the voices of investors are muffled and giant corporations are dominated by even more powerful index funds.

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Elon Musk Impostors Scammed $2 Million in Cryptocurrency, U.S. Says

The proposition was tantalizing: Handsome returns awaited investors who would be willing to provide an infusion of cryptocurrency to Elon Musk, the billionaire chief executive of Tesla and founder of SpaceX, for a moneymaking venture.

It seemed too good to be true, because it was.

Investors lost $2 million in six months to fraudsters who impersonated Mr. Musk, the Federal Trade Commission said in a report released on Monday that was meant to draw attention to a spike in cryptocurrency scams.

The commission found that nearly 7,000 people lost a reported $80 million over all from October through March as part of various scams targeting investors in Bitcoin and other cryptocurrencies like Dogecoin, a nebulous marketplace that Mr. Musk has bullishly promoted on Twitter. The median amount that they lost was $1,900, according to the commission.

The spate of fraud cases — a nearly 1,000 percent increase compared with the same period the previous year, the report said — came as the price of Bitcoin and Dogecoin soared toward record highs.

bought $1.5 billion worth of Bitcoin, which Tesla said was part of an initiative to invest in alternative assets like digital currencies and gold bullion.

accept Bitcoin as payment for cars in the United States, sent the price of Bitcoin skyward by more than 10 percent. But then Mr. Musk reversed course this month, saying that the company will no longer accept the cryptocurrency because of concerns over its effects on the environment.

Mr. Musk has similarly sent mixed messages regarding Dogecoin, which was created as a cryptocurrency parody in 2013 and has recently been booming.

Last week, he polled his 55.1 million followers on Twitter on whether Tesla should accept Dogecoin; 78 percent of respondents said yes. He also revealed last week that SpaceX would launch a satellite to the moon next year in exchange for a payment in Dogecoin. In a May 8 appearance on “Saturday Night Live,” Mr. Musk said that cryptocurrency was both “the future of currency” and “a hustle.”

Joseph A. Grundfest, a professor of law and business at Stanford and a former member of the Securities and Exchange Commission, said in an interview on Monday night that the surge in scams involving cryptocurrency was not at all surprising amid the surging prices.

He said that investors should be more circumspect when faced with propositions like those concocted by the impersonators of Mr. Musk.

“Don’t send cryptocurrency to Elon Musk,” Mr. Grundfest said. “He already has more than he needs.”

The Federal Trade Commission cautioned on Monday in the report that fraudsters had used online dating platforms to lure people into cryptocurrency scams. About 20 percent of the money that people reported losing through romance schemes since October was sent in cryptocurrency, the report said.

The commission also noted that people ages 20 to 49 were more than five times as likely as older people to report losing money on cryptocurrency investment scams.

Cryptocurrency experts cautioned that it was especially difficult for victims of fraud schemes to get their money back and that cryptocurrency had become a preferred payment method for those orchestrating ransomware attacks.

“As a practical matter, there is no recourse,” Mr. Grundfest said. “Why crypto? It’s very simple. It’s very hard to trace.”

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Leslie Moonves Receives Nothing From CBS Exit Package

Leslie Moonves, who led CBS as chief executive for 15 years before he was ousted in 2018, will receive nothing from the $120 million the company had set aside in a potential severance package, according to a federal filing on Friday.

Mr. Moonves left CBS on Sept. 9, 2018, after more than a dozen women accused him of sexual misconduct, allegations that appeared in two articles in The New Yorker by Ronan Farrow. Mr. Moonves has denied the allegations.

That October, as part of a separation agreement, the CBS Corporation board placed $120 million in a so-called grantor trust. That money would go to Mr. Moonves if the company found that there had been no grounds to fire him under his contract.

In December 2018, the board said it had determined that Mr. Moonves was indeed fired for cause, citing “willful and material misfeasance, violation of company policies and breach of his employment contract” in a statement at the time. Mr. Moonves disputed that finding and started arbitration proceedings concerning the possible exit package in January 2019.

it said.

The filing came from ViacomCBS. Mr. Moonves’s previous employer merged with a sibling company, Viacom, in December 2019, after protracted negotiations. Mr. Moonves adamantly opposed the merger plan when he was at the helm of CBS.

“The disputes between Mr. Moonves and CBS have now been resolved,” ViacomCBS said in a statement on Friday. It added that the company and Mr. Moonves would have no further comment on the matter.

Mr. Moonves, 71, was one of the most prominent figures to be toppled by the #MeToo movement. Other powerful men in the media and entertainment businesses whose careers came to an end after they were accused of sexual misconduct included the Fox News chief executive Roger E. Ailes and the film mogul Harvey Weinstein. Mr. Ailes died in 2017, months after leaving the network he had helped create, and Mr. Weinstein fell from power in 2017 and was sentenced last year to 23 years in prison for sex crimes against six women.

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As Scrutiny of Cryptocurrency Grows, the Industry Turns to K Street

The board of advisers at the digital chamber is stuffed with former federal regulators, including a former member of Congress and a recent chairman of the Commodity Futures Trading Commission, J. Christopher Giancarlo, who was named to the board of BlockFi, a financial services company that tries to link cryptocurrencies with traditional wealth managers.

Max Baucus, the Democratic former chairman of the Senate Finance Committee, and Jim Messina, a former top Obama adviser, also have recently been named to senior industry posts.

Lobbying disclosure records show that at least 65 contracts as of early 2021 addressed industry matters such as digital currency, cryptocurrency or blockchain, up from about 20 in 2019. Some of the biggest spenders on lobbying include Ripple, Coinbase — the largest cryptocurrency exchange in the United States — and trade groups like the Blockchain Association.

The lobbying burst is one of several recent signs nationwide that the industry is becoming a bigger presence in the economy. FTX, the cryptocurrency trading firm, is spending $135 million to secure the naming rights to the home arena of the Miami Heat.

The billionaire Elon Musk, who hosted “Saturday Night Live” this weekend, was asked about Dogecoin, a cryptocurrency featuring the face of a Shiba Inu dog that was created as a joke but has recently surged in value. “It’s the future of currency. It’s an unstoppable financial vehicle that’s going to take over the world,” Mr. Musk said, before adding, “Yeah, it’s a hustle.” The price of Dogecoin plunged nearly 35 percent in the hours after the show aired.

With the industry’s hires of recent government officials, claims of conflicts of interest are already starting to emerge.

Jay Clayton, who was the S.E.C. chairman until December, is now a paid adviser to the hedge fund One River Digital Asset Management, which invests hundreds of millions in Bitcoin and Ether, two cryptocurrencies, for its clients. Mr. Clayton declined to comment.

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Help Wanted: Someone With Money and Connections

So you’ve been asked to become a director of a special purpose acquisition company, more commonly known as a SPAC. The job has something in common with being a director of a company. But there’s one big difference: Instead of overseeing a company that is building, selling or creating something, you’re in charge of a big pot of money.

Sure, being asked to become a director of a SPAC is a coveted brass ring in certain circles. In return, you’ll be asked to contribute knowledge and capital to the SPAC, whose sole purpose is to find a company that wants to go public within two years. At that point, you’ll most likely no longer be a director.

If it all works out, you can make a lot of money. But there are also risks — the biggest one being not finding a high-quality company in time that wants to merge with your SPAC.

So what should you do if you’re asked to be a director of one of these entities? The first thing is to know who else is on the board and to be sure you understand that SPAC’s mission, according a report from the Cresset wealth management firm.

Navigation Capital Partners, which specializes in SPACs. “I think there are too many people in SPACs right now, and we’ll see a lot of them fail to do deals.”

He added, “There are celebrities lending their names to SPACs when they don’t even know what the business is.”

A SPAC exists solely to acquire a single, mature company and make it a public company through a reverse merger, since the SPAC is already public. As a director, your job isn’t to keep an eye on the company’s management team; it’s to find a company with an already solid management team that is ready to go. Once the reverse merger occurs, the SPAC is dissolved and the job of many of its directors is done — albeit with a hopefully sizable payout for their work.

taken public, more than the 248 offerings in all of last year and up from 59 in 2019. There has been some talk of the ardor cooling for SPACs, but they remain a way for the wealthy to make returns they can’t get elsewhere.

The increase in companies going public through SPACs was initially driven by companies’ inability during the pandemic to travel for the traditional roadshow associated with an initial public offering. The number of SPACs has continued to grow because they offer a means for mature companies to go public without the traditional filings for an I.P.O. (though the process of being acquired by a SPAC is certainly not without paperwork and legal counsel).

But given the proliferation of SPACs, the S.E.C. has tightened the rules, particularly those relating to the forecasts the SPACs make about their progress toward merging with a company and how certain classes of shares in the SPAC are treated for accounting purposes. These tighter rules are good for some SPACs and their directors, and not so good for others.

“The S.E.C. is getting a bit nervous,” said Jennifer Ceran, who is on the board of Plum Acquisition, a SPAC focused on finding a technology company, and was previously the chief financial officer of Smartsheet and Coupons.com, two technology companies she helped take public. “Your forecasts have to be based on sound data. As operators, I’ve lived my career giving multiyear forecasts and given reports to our company.”

Directors of a SPAC are not joining an existing public company or a private company with plans to go public. They’re joining an entity with ideas, aspirations and money — but no cash flow.

The directors are expected to use their own industry knowledge and connections to help find a company to merge with. “One of the important elements of being a director is not just industry experience but also really good networks,” Ms. Ceran said. “You want the management team and the board to have connections. You need to have people involved in your SPAC who have been operators at companies and are not just transaction folks.”

Vin Murria, a technology entrepreneur in London who has taken three companies public through the traditional listing process, said several SPACs had approached her because they wanted to tap her knowledge of the European market.

“I can do some great introduction in the European technology space,” Ms. Murria said. “I know pretty much everyone, in a positive way.”

Simply put, the directors of a SPAC are expected to be a dream team. Culled from related but distinct industries, their expertise is meant to help find the company, woo the founders and bring it public in a reverse merger. Think of the movie “Ocean’s Eleven,” where everyone brought a different skill to pull off the heist.

Directors are generally among the group that puts up risk capital, which is the cash to help the SPAC fund its search for a company to take public. In turn, they are given an allocation of shares before the SPAC itself goes public. Shares in the SPAC are also how the directors are compensated — in lieu of traditional payments to directors.

In theory, at least, the SPAC will identify a company to buy and bring in some additional capital from what’s known as the PIPE market — or private investment in public equity — and then the company takes over the public listing and the SPAC fades away.

But how many SPACs are going to fail to find a company to acquire in the required two years, and what are the repercussions for the directors who are held to the standards of any public company director?

Because a director on a SPAC board is a temporary position, knowing who your partners will be is even more important, said Louise Sams, a retired executive vice president and general counsel of Turner Broadcasting System. She sits on the boards of two public companies as well as D&Z Media Acquisition, a SPAC.

“You have to think about the management team,” she said. “What law firm are they using? What investment bank are they using? What’s your comfort level with all of those people? As long as your comfort level is high, then you should join.”

Ms. Sams said it was important for her to know that the other directors came with knowledge and connections that could help the SPAC find a company. “You need to know what you’re bringing to the table,” she said.

Because once you get to the table, it’s a sprint to find a company and fulfill your mission.

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The Fed and the S.E.C. chair have their eyes on meme stocks and the Archegos fallout.

The Federal Reserve’s Financial Stability Report, released Thursday, followed an unusual six months for markets. Over that period, stocks climbed steadily as the U.S. economic outlook rebounded, and stories of excess began to crop up, such as the frothy markets around so-called “meme stocks” such as GameStop and huge losses at a number of banks tied to problems at a hedge fund, Archegos Capital Management.

“While broader market spillovers appeared limited, the episode highlights the potential for material distress” at financial companies that aren’t banks “to affect the broader financial system,” the Fed said in its report. It said hedge fund opacity had also raised questions during the meme stock episode: Some funds that were betting against the stocks in question took losses as chat board vigilantes poured into them.

The answer to both episodes, the Fed seemed to suggest, starts with better data, Jeanna Smialek reports for The New York Times.

Gary Gensler, the new chairman of the Securities and Exchange Commission, said at a House Committee on Financial Services hearing that the S.E.C.’s staff has been working on a report addressing the issues raised by the GameStop episode that will be released this summer. He also said new rules may be needed for brokerage apps that turn stock trading into a game or contest, a method called gamification, Matthew Goldstein reports.

the collapse of Archegos pushed regulators to consider whether traders should be required to disclose derivatives. Archegos’s losses were mostly attributed to the firm investing heavily in total return swaps, a type of highly leveraged derivative that can give a trader exposure to a stock without actual ownership.

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S.E.C. Chair Gensler Emphasizes Transparency in Markets

Gary Gensler is putting transparency in the markets and the need to understand the impact of new technology at the top of his priority list as the new chairman of the Securities and Exchange Commission.

“I think transparency is at the heart of efficient markets,” Mr. Gensler said during his first testimony on Capitol Hill as the nation’s top securities cop.

Mr. Gensler, speaking from his living room, appeared by video before the House Committee on Financial Services to discuss the S.E.C.’s response to the tumultuous trading in shares of GameStop in January. The massive run-up in the stock price of the video game retailer was fueled by small investors who bought its shares on Robinhood and other commission-free trading apps and banded together on social media to cause big losses for a hedge fund that had bet GameStop shares would fall. Some investors who bought shares of GameStop at the peak later lost money.

Mr. Gensler said the S.E.C.’s staff has been working on a report addressing the issues raised by the episode that will be released this summer. He also said new rules may be needed for brokerage apps that turn stock trading into a game or contest, a method called gamification.

the collapse of Archegos Capital Management, which caused more than $10 billion in losses for Wall Street banks, pushed regulators to consider whether traders should be required to disclose derivatives — the financial trading instruments that allowed Archegos to take massive positions in stocks without attracting attention. Archegos’s losses were mostly attributed to the firm investing heavily in total return swaps, a type of highly leveraged derivative that can give a trader exposure to a stock without actual ownership.

Mr. Gensler’s tenure got off to a rocky start after Alex Oh, his pick to serve as director of enforcement, had to resign just days after being named because Paul, Weiss, the big law firm she had worked for, was facing potential sanctions in a case in which she was heavily involved.

The hearing with Mr. Gensler was the third and final one focusing on GameStop and the frenetic trading in the markets held by the House Financial Services Committee. The first hearing on Feb. 18 was held when shares of GameStop were trading around $40 a share after falling from a high of $347 a share. Since then, the stock has soared again, rising nearly 300 percent to $160 a share.

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What the Gates Divorce Means for the Gates Foundation

The Bill and Melinda Gates Foundation started with ambitions that, by its lofty standards today, appear almost quaint: providing free internet access to public libraries in the United States. As its founders’ objectives grew in scope, so did the foundation’s reach, until it achieved its current position as the pre-eminent private institution in global public health.

With 1,600 staff members directing $5 billion in annual grants to 135 countries around the globe, the Gates Foundation set a new standard for private philanthropy in the 21st century.

All of that was thrown into question on Monday when the world learned that the foundation’s co-chairs, who had been married for 27 years, filed for divorce in Washington State. Grant recipients and staff members alike wondered what would happen and whether it might affect the mission.

The message from the headquarters in Seattle was clear: Bill and Melinda Gates may be splitting up, but the Bill and Melinda Gates Foundation isn’t going anywhere. Their roles as co-chairs and trustees are not changing, and they will still set the agenda for the organization that bears their names. In an email on Monday, the Gates Foundation’s chief executive, Mark Suzman, reassured the staff that both Mr. and Ms. Gates remained committed to the organization.

observers noted that Ms. Gates had added her maiden name, French, to her Twitter profile.

The couple deployed their connections last year in response to the pandemic, calling leaders like Chancellor Angela Merkel of Germany and Crown Prince Mohammed bin Zayed of Abu Dhabi to drum up support for their plans. The foundation has committed $1.75 billion so far to its Covid-19 response, and played a key role in shaping the global deal to bring vaccines to poor countries.

That prominence has also brought a fair share of scrutiny, throwing a spotlight on Mr. Gates’s robust defense of intellectual property rights — in this case, specific to vaccine patents — even in a time of extreme crisis, as well as the larger question of how unelected wealthy individuals can play such an outsize part on the global stage.

“In a civil society that is democratic, one couple’s personal choices shouldn’t lead university research centers, service providers and nonprofits to really question whether they’ll be able to continue,” said Maribel Morey, founding executive director of the Miami Institute for the Social Sciences.

reported earlier by Bloomberg.

Before the news of the divorce broke, the Gates Foundation had been in the midst of a period of upheaval. The pandemic shuttered its headquarters in Seattle even as staff members drawn from the top ranks of government health agencies and the pharmaceutical industry worked to muster a response to the deadly, rapidly spreading new coronavirus.

And as his public profile during the pandemic grew, so did spurious conspiracy theories such as that the global immunization effort was a cover for Mr. Gates to implant microchips to track people, blatantly false but still damaging as misinformation increased vaccine hesitancy.

Then Mr. Gates’s father, Bill Gates Sr., also a foundation co-chair, died in September. The elder Mr. Gates had initially taken the lead on his son’s charitable endeavors while the younger Mr. Gates was still at the helm of Microsoft. Bill Gates Sr. was viewed by many as a calm voice and a moral compass within the organization, even as he had stepped back in recent years.

The third trustee, the billionaire investor Warren E. Buffett, turned 90 last year and has begun to discuss succession plans at his company, Berkshire Hathaway.

Dr. Morey said the recent changes could also present an opportunity to create a large, diverse board while increasing visibility into the foundation’s decision-making. “Part of the anxiety is coming from the lack of transparency in the day-to-day activities of the Gates Foundation,” she said.

Forbes estimates at $124 billion. The divorce won’t affect the money that has already been given to the foundation trust, but the couple may devote less money to it over time than they would have if they had stayed together.

“People are right to feel unmoored in terms of the direction of the foundation,” said Ms. Tompkins-Stange of the University of Michigan. “There’s a lot of ambiguity, as there might be in any divorce situation, but they seem committed to co-parenting the foundation.”

David Gelles contributed reporting.

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Volkswagen Under S.E.C. Scrutiny After Gag Falls Flat

Volkswagen’s American unit was only kidding when it put out the word late in March that it was changing its name to “Voltswagen” to show its commitment to electric vehicles. To say the April Fool’s joke didn’t land is an understatement. Now the misfired marketing gag has prompted an inquiry by the Securities and Exchange Commission.

Volkswagen did not dispute reports in Der Spiegel and other German media that the S.E.C. was looking into whether the carmaker misled shareholders with the faux rebranding. Volkswagen in Germany declined to comment Friday.

Publicly listed companies are not supposed to fool their shareholders, even in jest. Some media reported the purported name change as fact until Volkswagen of America admitted it was all a joke.

German law also requires companies to be honest with their shareholders, but a spokeswoman for the stock market regulator, known as Bafin, said the agency saw no basis to investigate the Voltswagen issue.

emissions scandal has cost the company since 2015. The gag does not appear to have had any influence on the price of Volkswagen shares, which rose for several days even after the company admitted it was all a ruse.

Like a comedian bombing onstage, the most painful consequence may be the humiliation.

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