The SEC’s Office of Compliance Inspections and Examinations this past week issued risk alerts specifying what examiners may look at when they visit advisory firms and broker-dealers to check on compliance with Form CRS and Regulation Best Interest. With the SEC now clear that the June 30 compliance date for both requirements will not be changed (ACA Insight, 4/6/20), firms – already dealing with the problems created by the coronavirus – will need to make sure they are in compliance, applicable with these new rules.
The Standards of Conduct package did not receive the warmest welcome by many in the asset management community when it was adopted last year. Perhaps that was to be expected in that any solution to an issue that has been debated for years – raising the standard of conduct of broker-dealers to a higher level – could not please everyone and would also be likely to create some confusion.
The four parts of the SEC’s standards of care package, adopted this past June by the SEC and met with some concern and confusion by those affected by them in the asset management community, can be expected to result in the agency issuing guidance to help advisers and others comply. In that regard, the SEC’s Division of Investment Management’s new set of answers to FAQs, released December 3, might provide some help.
It was perhaps inevitable, given the divisions over the SECs adoption of Regulation Best Interest. Eight attorneys general, representing seven states and the District of Columbia, this month filed suit in federal court, asking, among other things, that the Rule be tossed. The states – New York, California, Connecticut, Delaware, Maine, New Mexico, Oregon – […]
Word to the wise: When in a deal, represent just one of the players. Advisers representing more than one party in a transaction may think they have a sweet arrangement, but it is more likely they catch the eye of the SEC Division of Enforcement. Its not worth it. MVP Manager, a New York City-based […]
The end of 2021 may still seem some far off, but in terms of advisers and other market participants that will need to transition from the London Interbank Offered Rate (LIBOR), it may be getting uncomfortably close. The SEC staff in July issued a statement urging all market participants using LIBOR to begin the process of moving away.
The SEC is standing its ground on Regulation Best Interest, the investment adviser fiduciary interpretation, Form CRS and the agencys interpretation of the "solely incidental" prong under the Advisers Act. Much of the criticism, agency Chairman Jay Clayton said in a strongly-worded July 8 Boston speech, is "false, misleading, and, unfortunately, in some cases, is simply policy preferences disguised as legal critiques."
Every day is different. Less than a month ago, the SEC adopted the components of its Standards of Conduct Package - Regulation Best Interest, Form CRS, an interpretation of an advisers fiduciary duty, and an interpretation of what constitutes "solely incidental" advice provided by broker-dealers. On June 26, the U.S. House of Representatives passed an amendment to an appropriations bill that would prevent the SEC from using its funds to "implement, administer, enforce or publicize" those same rules and interpretations.
SEC Adopts Form CRS, Regulation Best Interest, Adviser Fiduciary and Solely Incidental Interpretations
The SEC on June 5, with one commissioner dissenting, adopted the much-discussed Standards of Care package, including Form CRS, Regulation Best Interest, a new Commission interpretation of adviser fiduciary duty, and an interpretation relating to when a broker-dealer may give advice to a client without being considered an adviser.
The long wait may finally be over. The SEC on June 5 will conduct an open public meeting to consider whether it will adopt new and amended rules and interpretations that have been a source of contention within the asset management community for years: the standards of conduct package.