Broker- Dealer Law Corner

Broker- Dealer Law Corner

Tag Archives: Fiduciary Standard

OMB Approves Additional Delay For Further Study Of The DOL Fiduciary Rule

Posted in Fiduciary Rule
The Office of Management and Budget’s Office of Information and Regulatory Affairs (OIRA) announced this week that it was effectively approving a delay in full implementation of the Department of Labor (DOL) Fiduciary Rule. After several years of study and comment, the final version of the Rule was originally slated to take effect earlier this… Continue Reading

How The Fiduciary Rule May Impact Outside Business Activities

Posted in annuities, Fiduciary duty, Fiduciary Rule, Fiduciary Standard
Because fixed annuities and fixed life insurance are not securities, many broker-dealers treat the sales of these products by their registered reps as outside business activities. In that event, there is no obligation by the BD to supervise those sales, and they can be run directly with the issuing company and not through the broker-dealer. … Continue Reading

DOL Seeks To Clarify Fiduciary Rule Timing With Temporary Enforcement Policy

Posted in Fiduciary duty, Fiduciary Rule, Fiduciary Standard
On Friday evening, March 10, 2017, the Department of Labor (DOL) issued a field assistance bulletin establishing a new temporary enforcement policy for the DOL Fiduciary Rule set to become effective on April 10, 2017. (See here) The temporary policy was designed to deal with industry uncertainty created by a new rule proposed for comment by… Continue Reading

Trump Actions on the DOL Fiduciary Rule and Dodd-Frank

Posted in Dodd Frank, Fiduciary duty, Fiduciary Rule, Fiduciary Standard
Here are some important observations from my partner, Fran Goins, on two missives President Trump issued on Friday that you should know about.  My own politics have made themselves pretty clear in recent posts, so it’s good to have someone comment on these presidential pronouncements without the snarkiness I would have undoubtedly injected, wittingly or otherwise. … Continue Reading

The Wendell Belden Case And Its Progeny: Fiduciary Before Fiduciary Was Cool

Posted in Fiduciary duty, Fiduciary Standard, FINRA
The entire securities world is anxiously awaiting the implementation of the fiduciary standard over retirement accounts, and, by most accounts, the eventual spread of that standard to ordinary investment accounts. I am not prepared to argue that this is not a big deal, and will cost the industry a ton of time and money to… Continue Reading

Highlights from Day Two of SIFMA-CL Conference

Posted in AML, CCO, CCO liability, Compliance, Culture, FINRA, Senior Investors, SIFMA
The Rick Ketchum Show. Today’s sessions opened with what was likely the highlight of the entire conference, Rick Ketchum’s swan song “conversation” with Ira Hammerman, GC of SIFMA, before he toddles off into retirement. Granted, these interviews never remotely approach Sixty Minutes intensity, but this year’s featured even more coddling than ever: What would you… Continue Reading

Highlights from Day One of SIFMA-CL Conference

Posted in Best execution, CCO liability, Culture, Fiduciary duty, Fiduciary Standard, FINRA, municipal securities, SEC, SIFMA, Supervision
Opening Session/Firm Culture/CCO Liability. If you are reading this blog, then you, like me, have been probably eagerly waiting for the start of SIFMA’s annual Compliance and Legal conference not just for the jumbo shrimp at the reception, but also to learn some insights from the regulators about their concerns and intentions. If you attended… Continue Reading

FINRA Merely Wants To Understand Your Firm’s “Culture” (And I Have A Bridge To Sell You)

Posted in Compliance, Conflict of Interest, Culture, Examination, Fiduciary Standard, FINRA
By now you have probably read FINRA’s recent “Targeted Exam Letter” entitled “Establishing, Communicating and Implementing Cultural Values.”  In case you haven’t, it is clear that FINRA is following up on the promise it made in January in the 2016 Regulatory & Examination Priorities Letter to “formalize [its] assessment of firm culture while continuing [its]… Continue Reading

Best Execution Standard Murkier Than Ever Despite So-Called “Guidance”

Posted in Best execution, Fiduciary Standard, FINRA
Based on the definition employed by Supreme Court Justice Potter Stewart in 1964, best execution is the opposite of hard-core pornography: no one seems to know it when they see it. Despite this (at best) fuzzy standard, FINRA and the SEC still require all broker-dealers to obtain best execution for their customers when they place… Continue Reading

The Ongoing Puzzle Of Ongoing Due Diligence

Posted in Disciplinary Process, Due diligence, Enforcement, Examination, Fiduciary Standard, FINRA, Private Placement, Reg D, Rule 2111, Supervision
I am currently in the midst of a FINRA examination that is largely focused on the adequacy of the due diligence that my broker-dealer client conducted of a private placement. What is puzzling about the exam is that FINRA is not just interested in the due diligence that was conducted prior to effecting any sales… Continue Reading

SEC Supports Creating a Uniform Fiduciary Standard; But is FINRA Already Enforcing It?

Posted in Fiduciary Standard, FINRA, SEC
SEC Chairwoman Mary Jo White recently announced her support of a uniform fiduciary standard for broker-dealers and investment advisers, ending any remaining speculation as to her views on the subject. The announcement kicked of a whirlwind of speculation in the industry – What would the new standard look like? When would we see it? Will… Continue Reading
.