Each week we’re giving you our weekly report highlighting the top compliance news articles from various industry news publications. We have selected the most relevant and important news articles related to registered investment adviser (“RIA”) compliance and regulatory issues. This week’s recap focuses on the latest Department of Labor (“DOL”) fiduciary rule delay, Dodd-Frank, and calculating regulatory assets under management (“AUM”). Check back each week for the latest list of top stories.
Here’s our top investment adviser compliance articles for the week of May 6, 2017:
- Interesting Angles on the DOL’s Fiduciary Rule #46 (Author- Fred Reish, Fredreish.com)
Fred Reish, one of our top 5 DOL fiduciary rule experts to follow, published his 46th article about his observations on the DOL fiduciary rule. In this particular article, he provides insight on how an adviser can adapt to the Best Interest Standard. Reish informs, “Beginning on June 9, the new ‘transition’ exemptions will apply to investment and insurance recommendations for IRAs.” He elaborates in detail on the Best Interests Contract Exemption (BICE) and when it is required. Reish also advises that fiduciary training and education is needed before the June 9 rule applicability date.
- Calculating Accurate Regulatory AUM Vs Reporting Assets Under Advisement (AUA) (Author- Michael Kitces, Kitces.com)
Michael Kitces, a notable financial planning industry guru, brings us this article on calculating assets under management (“AUM”) and assets under advisement (“AUA”) and the credibility these aspects give to a firm. In addition, he discusses the importance of regulatory assets under management (“RAUM”) as well as further clarifying what does and does not qualify as RAUM.. This is a topic likely to get more focus with the upcoming Form ADV changes effective on October 1, 2017.
- Dodd-Frank Overhaul Could Cause Fiduciary Rule Mess (Author- Kristen Ricaurte Knebel, Bloomberg)
“A major overhaul of the Dodd-Frank Act that would also repeal the DOL’s fiduciary rule could cause a mess for the financial services industry if it is enacted after the rule’s June 9 applicability date” reports Kristen Knebel, Senior Reporter for Bloomberg. If the Financial Choice Act is ultimately passed, it would permanently put a stop to the DOL fiduciary rule. Andrew L. Oringer, partner with Dechert LLP in New York and co-chair of the firm’s ERISA and executive compensation group, contributes to Knebel’s Bloomberg report and voices his opinions on the potential future impact of the bill.
- Finra Gets Kudos for Revamping Exams (Author- Dan Jamieson, Financial Advisor)
The Financial Industry Regulatory Authority (“FINRA”) has reportedly “proposed a revamp of its registration rules that would create a two-tier examination system and allow more flexibility in obtaining and maintaining licenses” according to Dan Jamieson, Financial Advisor reporter. The drive behind this has been a way to open up career opportunities and spark interest of the industry. Plans for a “securities industry essentials” (“SIE”) exam has currently been a topic of discussion and would cover industry basics. The proposal for this is currently awaiting for approval from the Securities and Exchange Commission’s (“SEC”).
- DOL Chief Looks to Deep Freeze Fiduciary Rule (Author- Steve Morelli, InsuranceNewsNet)
InsuranceNewsNet reporter, Steve Morelli, discusses Labor Secretary Alexander Acosta’s plan to freeze the DOL fiduciary rule in a way that would “stick”. Acosta reportedly told Sen. Tim Scott, R-S.C., that the rule is first on his list of priorities and is aware of how urgent it is. Scott had signed a letter along with 124 other lawmakers that demanded Acosta and the DOL reform the rule. It is unclear at this time if the DOL will take any action before the upcoming June 9 applicability date.
Don’t forget to check out last week’s top RIA compliance news articles on the DOL fiduciary rule and succession planning. Be sure to check back next Friday for next week’s top articles!