On June 5, 2019, the U.S. Securities and Exchange Commission (“SEC”) passed Regulation Best Interest (“Reg BI”). BDs will be required to act in the best interest of their retail customers when recommending any securities transaction or investment strategy. As part of Reg BI, BDs and registered investment advisers (“RIAs”) will be required to provide retail investors with a Form CRS Relationship Summary which discloses the nature of the relationship between the entities and their customers.
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Given the tone of the business plan with regards to financial crime, and a reiteration of its focus on firm governance and culture, it is no surprise that the assessments by the FCSST focussed on 6 areas. If the indications from the documents requested by the FCSST, and the interviews that took place during the onsite portion of the assessment, are anything to go by, it is clear the FCA is following through on its intent to be more intrusive.
The Office of the Comptroller of the Currency (“OCC”) recently issued its Spring 2019 Semiannual Risk Perspective, a recurring report of key risk areas and emerging threats to the federal banking system that are monitored by the OCC's National Risk Committee. In this blog post, we summarize the risk areas that impact banking asset management groups, and operational risk, strategic risk, and BSA/AML.
ACA Compliance Group is pleased to present their newest survey results in the form of a white paper, 2019 Liquidity Risk Management Program Rule Survey Results.
FINRA recently issued Regulation Notice 19-18 (the “Notice”), which provided guidance to member firms regarding their monitoring obligations with respect to suspicious activity pursuant to the Bank Secrecy Act (“BSA”) and anti-money laundering (“AML”) requirements.
The Financial Conduct Authority (FCA) has made no secret of its intention to crack down on firms and individuals that fail to meet their obligations under the Market Abuse Regulations (MAR) and FCA rules.
Hot on the heels of two well publicised MiFID I fines for transaction reporting failings, the FCA has published Market Watch 59, the content of which is totally monopolised by transaction reporting. This signals that the regulator is now squarely turning its attention to failings under the MiFID II regime. The FCA once more reinforces the importance of complete and accurate transaction reports.
The staffing needs for financial services firms are constantly evolving. The ever-changing regulatory landscape combined with the increasing adoption of regulatory technology can make finding and retaining qualified staff with the required proficiencies a challenge for HR departments and recruiters.
ACA Compliance Group and the Investment Adviser Association invite you to participate in the 2019 Investment Management Compliance Testing Survey. The survey is open to compliance professionals at SEC-registered investment advisers. The survey will remain open through Friday, May 31.
The total dollar amount of fines in 2018 that the Financial Industry Regulatory Authority’s (“FINRA”) Enforcement Division ordered against its member firms increased slightly to $74 million from $68 million in 2017. While the total dollar amount increased nearly nine percent, the total number of fines decreased to 209 in 2018, compared to 318 in 2017. Both the number and dollar amount of fines assessed by FINRA have fallen significantly since 2014, as the charts below show. In 2014, FINRA fined broker-dealers a record amount of nearly $129 million dollars, roughly 10 percent greater than the total dollar amount assessed in 2017 and 2018 combined.
Several new regulatory requirements and developments should be evaluated by certain ETF sponsors and advisers regarding changes to the stock-exchange listing standards and Regulation M. This article summarizes these developments and their potential compliance program implications.