Commentary Archives

SEC Urges Stricter Robo-Adviser Compliance

The SEC has suggested that investment advisers improve robo-adviser compliance by tightening policies and procedures for automated digital investment advisory services. The regulator gave deficiency letters to “nearly all” of the advisers whose robo-advisory services it recently examined, according to a new SEC risk alert regarding electronic investment advice. “The examinations conducted within the scope of this review resulted in a range of actions,” the SEC stated in the risk alert. “In response to the staff’s observations, some advisers elected to amend disclosures and marketing materials, modify or eliminate performance advertisements, revise compliance policies and procedures, improve data protection practices, […]

SEC Continues to Update Rules for Investment Adviser Marketing

Investment adviser marketing has taken another step into the present now that the SEC has announced it is withdrawing or modifying over 200 staff letters and guidance statements related to the decades-old IA Advertising and Cash Solicitation Rules. Most of the no-action relief letters being withdrawn are related to issues that are now covered in the SEC’s modernized IA Marketing Rule. “It’s no wonder IAs have been so challenged under the old Advertising and Cash Solicitation Rules since they had to manage so many exceptions to the actual rules. It would be helpful if the SEC would share a list […]

State-registered Investment Advisers Lack Protections for Financial Abuse of Elderly

Recently released results from a sweep exam show that state-registered investment advisers must do more to prevent and address financial abuse of elderly investors, regulators say. “The results of this multi-state coordinated initiative show that investment advisers must make improvements in recognizing and reporting cases of suspected abuse,” said Lisa A. Hopkins, NASAA President and West Virginia Senior Deputy Commissioner of Securities, in announcing its findings of deficiencies in policies to protect seniors and vulnerable persons. “Our hope is that this data will foster greater and earlier detection and reporting of suspected financial exploitation of older Americans.” NASAA’s push for […]

NASAA Pushes for More Protection for Senior Investors

The North American Securities Administrators Association (NASAA) urges legislators to enact more laws and take more steps to increase protection for senior investors. NASAA reiterates its ongoing concerns about the potential financial exploitation of seniors and vulnerable adults while also recommending additional protections in a recently released legislative commentary on NASAA’s Senior Model Act. “Through this legislative commentary, we hope to encourage states to continue to adopt report and hold laws based on the Model Act,” said Lisa A. Hopkins, NASAA President and West Virginia Securities Commission General Counsel and Senior Deputy Commissioner of Securities, in announcing the commentary’s release. […]

RegEd Launches Real-time ‘Clear to Sell’ for Agents

RegEd CLEARXchangeSM enables real-time validation of contracting, licensure, education/training, appointment and registration for an instant “clear to sell.” RALEIGH, N.C., September 17, 2021 — Agents can place compliant business faster with the newly released RegEd CLEARXchange, the financial services industry’s most comprehensive Clear to SellSM solution for eliminating “not in good order” (NIGO) transactions and improving agent and adviser satisfaction. RegEd CLEARXchange offers a frictionless path to placing business and paying commissions compliantly by automatically validating that the producer holds the proper licenses and appointments for the business they are placing and for which they are receiving payment. The real-time […]

Documentation and Compliance Key in FINRA Sweep Exams of Options Accounts

Broker-dealers need to document their firm’s processes for supervising options trading and demonstrate compliance with them in new FINRA sweep exam on option accounts. The industry self-regulator is conducting targeted examinations of broker-dealers’ supervision of options trading as part of its ongoing efforts to protect retail investors. FINRA CEO Robert Cook had indicated in July that the sweep would be coming and the regulator followed through shortly thereafter, releasing its Targeted Examination Letter on Option Account Opening, Supervision, and Related Areas in early August. “Options are tricky and can be difficult to understand for certain investors. Even registered representatives recommending […]

Form CRS Enforcement Begins with $910,092 in Fines

The grace period for firms to furnish investors with Form CRS customer relationship summaries has indeed ended now that the SEC has sanctioned firms for the first time, a little more than a year after the requirement took effect. The SEC has fined 21 investment advisers and six broker-dealers a total of $910,092. Without admitting or denying the findings, the firms agreed to be censured, cease and desist from violating the charged provisions, and pay civil penalties ranging from $10,000 to $97,523. “Registration with the SEC as an investment adviser or broker-dealer comes with mandated filing and disclosure obligations,” Gurbir […]

Broker-dealers Hope for Permanent Remote Inspections as FINRA Ponders Extension

Regulators remain open to extending remote examinations for broker-dealers into 2022 and firms hope the relief will last even longer. FINRA President Robert Cook recently reiterated the need for exams to remain remote into 2022 during a conference held by the Securities Industry and Financial Markets Association’s (SIFMA), WealthManagement reported. “What I’d like to see happen here, at least where my thinking currently is, is we would extend it into next year, and that we would also step back and look at that rule more holistically, and think about whether it could use some updating to accommodate a thoughtful, risk-based […]

New State Insurance Regulations Surge as Regulators ‘Catch Up’ on Non-Pandemic Issues

State insurance regulations are changing faster than they did before the COVID-19 pandemic, though it may be hard to tell. While a flood of pandemic-related state regulations (laws, administrative rules, bulletins and notices) pushed the numbers of insurance regulations to a record 3,600 in 2020, this year’s regulatory activity has proven to be just as busy as the previous record-breaking year, 2019. Many of this year’s insurance changes have been included in omnibus bills, some of which have reached an unprecedented 2,500 pages, rather than being introduced as stand-alone bills. “This legislative season has been busy because last season got […]

DOL Fiduciary Rule Back in Play as Industry Preps for PTE 2020-02

New federal regulations for retirement advisers may not last long. Though the US Department of Labor’s exemption for investment advice fiduciaries has taken effect as planned and is expected to be enforced in December as scheduled, the agency has since signaled its intent to revisit its fiduciary regulation on a broader scale. The DOL recently announced its intent to amend the definition of the term “fiduciary” by including it as an item on its spring regulatory agenda. The agency revised the definition previously but it did not stick because a federal court vacated the DOL fiduciary rule that contained the […]

1 2 3 4 5

Posts navigation