In Regulatory Notice 23-09, FINRA provides an update on actions it currently has under way to promote capital formation and the capital-raising process. FINRA also requests comment regarding whether there are other changes to...more
The proposal would codify for the first time the federal-level best execution standard for brokers and related obligations. New Regulation Best Execution would result in a pivot from what has been a principles-based approach...more
FINRA recently published Regulatory Notice 22-23, providing guidance regarding firm and representative succession planning, including relevant FINRA rules and administrative processes and questions firms can consider when...more
FINRA recently highlighted Rule 3241 in the 2023 Regulatory Element Learning Plan. Rule 3241 became effective in early February 2021 and prohibits a registered person from being named as a beneficiary, executor, or...more
FINRA recently hosted a conference call with its smaller members covering Regulation Best Interest and Form CRS compliance. FINRA’s resounding message was that there is “no one-size-fits all” approach to Reg. BI...more
10/13/2022
/ Broker-Dealer ,
Compliance ,
Conflicts of Interest ,
Disclosure Requirements ,
Financial Industry Regulatory Authority (FINRA) ,
Form CRS ,
Investment Adviser ,
Investment Management ,
Regulation Best Interest ,
Regulation BI ,
Securities and Exchange Commission (SEC)
The SEC and CFTC recently charged 11 large financial institutions and their affiliates for failing to collect, monitor, and preserve communications over WhatsApp and other messaging services. These settlements follow a...more
10/7/2022
/ Affiliates ,
CFTC ,
Civil Monetary Penalty ,
Enforcement Actions ,
Financial Institutions ,
Government Investigations ,
Instant Messaging Apps ,
Investment Adviser ,
Recordkeeping Requirements ,
Securities and Exchange Commission (SEC) ,
Settlement ,
Social Media ,
WhatsApp
This article focuses on how the new Rule 206(4)-1 (the “Marketing Rule”) under the Investment Advisers Act of 1940 (the “Advisers Act”) affects the relationships between investment advisers registered with the U.S. Securities...more
10/4/2022
/ Advertising ,
Broker-Dealer ,
Compliance ,
Disclosure Requirements ,
Endorsements ,
Investment Adviser ,
Investment Advisers Act of 1940 ,
Marketing ,
New Rules ,
Policies and Procedures ,
Private Funds ,
Registered Investment Advisors ,
Risk Alert ,
Securities and Exchange Commission (SEC) ,
Testimonial Statements
SEC staff recently served up a juicy staff bulletin covering the standards of conduct for broker-dealer and investment adviser conflicts of interest. The staff bulletin includes 13 Q&As categorized into five different...more
U.S. Securities and Exchange Commission staff recently published a bulletin reiterating the standards of conduct applicable to broker-dealers and investment advisers when making account recommendations to retail investors....more
4/15/2022
/ Broker-Dealer ,
Conflicts of Interest ,
Fiduciary Duty ,
Investment Adviser ,
Investment Advisers Act of 1940 ,
IRA Rollovers ,
Regulation Best Interest ,
Retail Investors ,
Retirement Plan ,
Securities and Exchange Commission (SEC) ,
Standard of Conduct
This is the first in a series of alerts discussing topics covered by FINRA in its 2022 Examination and Risk Monitoring Program Report (the “Report”). Here we take a look at Regulation Best Interest (“Reg. BI”) and Form CRS,...more
2/25/2022
/ Broker-Dealer ,
Conflicts of Interest ,
Disclosure Requirements ,
Filing Requirements ,
Financial Industry Regulatory Authority (FINRA) ,
Form CRS ,
Investment Adviser ,
Policies and Procedures ,
Regulation Best Interest ,
Retail Investors ,
Securities and Exchange Commission (SEC) ,
Training
On December 17, 2021, the staff of the U.S. Securities and Exchange Commission issued a statement regarding Form CRS disclosures required of SEC-registered broker-dealers and investment advisers who offer services to retail...more
On October 7, 2020, the U.S. Securities and Exchange Commission (“SEC”) voted 3-2 to propose a conditional exemption (“Exemption”) to permit natural persons to engage in limited securities activities as “finders” on behalf of...more
10/12/2020
/ Accredited Investors ,
Broker-Dealer ,
Capital Raising ,
Comment Period ,
Disclosure Requirements ,
Exemptions ,
Finders ,
Investment Adviser ,
Investors ,
Private Offerings ,
Public Comment ,
Securities and Exchange Commission (SEC) ,
Securities Exchange Act ,
Securities Regulation ,
Securities Transactions ,
Unregistered Brokers
In a public statement issued on June 15, 2020, U.S. Securities and Exchange Commission (SEC) Chairman Clayton confirmed the June 30, 2020, deadlines for compliance with Regulation Best Interest (Reg. BI) and the Form CRS...more
The compliance date of June 30, 2020, is looming for U.S. broker-dealers subject to Regulation Best Interest (Reg. BI) and broker-dealers and investment advisers required to prepare and provide relationship summaries pursuant...more
5/19/2020
/ Broker-Dealer ,
Conflicts of Interest ,
Disclosure Requirements ,
Filing Deadlines ,
Form CRS ,
Investment Adviser ,
Popular ,
Regulation Best Interest ,
Retail Investors ,
SEC Examination Priorities ,
Securities and Exchange Commission (SEC) ,
Standard of Conduct
Regulatory Developments:
FINRA Requests Comment on Rules Relating to Financial Exploitation of Vulnerable Adults -
On Oct. 15 FINRA published Regulatory Notice 15-37, requesting comment on proposed amendments to...more
10/22/2015
/ Amended Regulation ,
BE-180 ,
Benchmarks ,
Comment Period ,
Conflicts of Interest ,
Consumer Financial Protection Bureau (CFPB) ,
Data Collection ,
Disclosure Requirements ,
Diversity ,
Elder Issues ,
Enforcement Actions ,
Exploitation ,
Financial Industry Regulatory Authority (FINRA) ,
Financial Institutions ,
Fines ,
Foreign Nationals ,
HMDA ,
Investment Adviser ,
Mortgage Lenders ,
Mortgages ,
Municipal Bonds ,
Neither Admit Nor Deny Settlements ,
Private Funds ,
Proposed Regulation ,
Public Offerings ,
Puerto Rico ,
Recordkeeping Requirements ,
Regulation C ,
Regulation M ,
Reporting Requirements ,
Restitution ,
Rule 105 ,
Sanctions ,
Securities and Exchange Commission (SEC) ,
Settlement ,
Short Selling ,
Surveys ,
U.S. Commerce Department
Regulatory Developments -
California Department of Business Oversight Permits Money Transmitter to Treat Customer Funds in Designated Custodial Account as “Eligible Securities” -
The California Department of...more
9/3/2015
/ Administrative Procedure Act ,
Anti-Money Laundering ,
Debt ,
Department of Business Oversight ,
Final Rules ,
Financial Industry Regulatory Authority (FINRA) ,
Financial Institutions ,
FinCEN ,
Information Reports ,
Investment Adviser ,
Money Laundering ,
Money Transmission Act ,
Money Transmitter ,
Patriot Act ,
Preliminary Injunctions ,
Proposed Regulation ,
Securities and Exchange Commission (SEC)
Regulatory Developments -
FINRA Proposes Rule to Require Member Websites to Link to BrokerCheck:
FINRA has proposed an amendment to FINRA Rule 2210 to require each of a member’s websites to include a readily...more
7/2/2015
/ BrokerCheck ,
Brokers ,
CFTC ,
Cross-Border Transactions ,
Cybersecurity ,
Employee Retirement Income Security Act (ERISA) ,
FFIEC ,
FIfth Third Bancorp v Dudenhoeffer ,
Financial Industry Regulatory Authority (FINRA) ,
Financial Institutions ,
Investment Adviser ,
Margin Requirements ,
Material Nonpublic Information ,
Reporting Requirements ,
Statute of Limitations
Regulatory Developments -
Client Alert: SEC Proposes Pay for Performance Rules:
Goodwin Procter’s Capital Markets practice has issued a Client Alert on the SEC’s proposed rule that would require most public...more
6/25/2015
/ Board of Directors ,
Broker-Dealer ,
Cybersecurity ,
Data Protection ,
Distributed Denial of Service ,
Dodd-Frank ,
Enforcement ,
Enforcement Actions ,
Executive Compensation ,
Financial Industry Regulatory Authority (FINRA) ,
Flood Insurance ,
Investment Adviser ,
Lenders ,
Morgan Stanley ,
Municipal Bonds ,
OCIE ,
Proxy Statements ,
Publicly-Traded Companies ,
Securities and Exchange Commission (SEC) ,
Security-Based Swaps ,
Swaps
SEC Proposals to Enhance Investment Company and Investment Adviser Reporting: As we went to press, the SEC commissioners announced that they had voted to approve two proposals. The first was for new and amended rules and...more
5/22/2015
/ Banks ,
Community Banks ,
Conflicts of Interest ,
Department of Labor (DOL) ,
Enforcement Actions ,
Fiduciary Duty ,
Investment Adviser ,
Investment Funds ,
Morgan Stanley ,
OCIE ,
Private Equity Funds ,
Securities and Exchange Commission (SEC) ,
Volcker Rule
In This Issue – More on the SEC Whistleblower Program.
In the April 8 issue of the Roundup we reported on the SEC’s administrative proceedings based on findings that restrictive language in a form confidentiality...more
Ninth Circuit Denies Rehearing of Northstar v. Schwab. On April 28, the U.S. Court of Appeals for the Ninth Circuit denied the petition of Schwab Investments’ (Schwab) for rehearing and rehearing en banc in the case of...more
4/30/2015
/ 401k ,
Broker-Dealer ,
Convertible Debt ,
Employee Retirement Income Security Act (ERISA) ,
Enforcement ,
Enforcement Actions ,
Fiduciary Duty ,
Financial Industry Regulatory Authority (FINRA) ,
Financial Institutions ,
Insurance Industry ,
Investment Adviser ,
Investment Company Act of 1940 ,
Money Market Funds ,
Municipal Advisers ,
Ontario Securities Commission (OSC) ,
Petition for Writ of Certiorari ,
SCOTUS ,
Securities and Exchange Commission (SEC) ,
Trustees
DOL Fiduciary Standard Proposal. The Department of Labor issued a notice of proposed rulemaking including a definition of the term “fiduciary,” a conflict of interest rule for retirement investments, new exemptions and...more
4/16/2015
/ Australia ,
Bank Holding Company ,
Capital Rules ,
Conflicts of Interest ,
Department of Labor (DOL) ,
Federal Reserve ,
Fiduciary Duty ,
Investment Adviser ,
NPRM ,
Pay-To-Play ,
Prudential Regulation Authority (PRA) ,
Retirement Plan ,
Securities and Exchange Commission (SEC)
The SEC Acts to Protect Whistleblowers Against Restrictive Confidentiality Provisions. In a development that should send HR directors and general counsels to review their form confidentiality agreements, the SEC announced...more
4/9/2015
/ Asset Valuations ,
Collateralized Loan Obligations ,
Confidentiality Agreements ,
Investment Adviser ,
Investment Funds ,
Iran Sanctions ,
KBR (formerly Kellogg Brown & Root) ,
Nuclear Weapons ,
Office of Foreign Assets Control (OFAC) ,
Rule 21F ,
Securities and Exchange Commission (SEC) ,
Subordination
Focus on Fiduciary Standards. In February the President’s Council of Economic Advisers (CEA) issued a Report on the Effects of Conflicted Investment Advice on Retirement Savings. In its conclusion, the Report estimated the...more
The CFTC Exercises Expanded Jurisdiction Over Retail Transactions in Physical Commodities.
Title VII of the Dodd-Frank Act of 2010 amended the Commodity Exchange Act (CEA) to add new authority over certain leveraged,...more
1/30/2015
/ Amended Legislation ,
CFTC ,
Class Action ,
Commodity Exchange Act (CEA) ,
Cuba ,
Cuban Assets Control Regulations (CACR) ,
Dodd-Frank ,
Enforcement Actions ,
Federal Reserve ,
Financial Industry Regulatory Authority (FINRA) ,
Investment Adviser ,
Pay-To-Play ,
Payment Systems ,
Proxy Advisors ,
Proxy Voting Guidelines ,
Regulatory Agenda ,
Sanctions ,
Securities and Exchange Commission (SEC)