Last week, William St. Louis, FINRA Senior Vice President and Regional Director, stated at the SIFMA C&L New York Regional Seminar that the regulator would begin reviewing firms in November to assess their Regulation Best Interest (“Reg BI”) compliance readiness. Reg BI becomes effective on June 30, 2020.
In addition, he said that FINRA would coordinate its reviews with the SEC to eliminate any duplication of effort. St. Louis further stated that, while FINRA would not be looking specifically for Reg BI infringements, it would not ignore any “egregious violations.”
As June 30, 2020 approaches, at minimum firms should ensure that their systems, policies, and procedures have been designed to comply with the following four obligations of Reg BI:
- Disclosure obligations
- Care obligations
- Conflict of interest obligations
- Compliance obligations
In addition, firms should begin drafting their Customer Relationship Summary (“Form CRS”). Form CRS, which outlines the scope of a firm and its representative relationships and services, will be provided to customers at prescribed times.
- SEC Approves Regulation Best Interest
- FINRA Releases Resources for Regulation Best Interest
- Investment Adviser Standard of Conduct and Form CRS - What You Need to Know (Part 1 of 2)
- Investment Adviser Standard of Conduct and Form CRS – What You Need Know (Part 2 of 2)
For More Information
For more information about Reg BI, please contact your ACA consultant or Dee Stafford at 561-628-5288 or email@example.com.