Top RIA compliance news articles for the week of Dec. 16, 2022

11 Big Advisor Regs That Moved Forward in 2022 (Author – Melanie Waddell, Think Advisor)

Both the SEC and FINRA have released a number of new regulations this year, in some cases drawing criticism from the industry due to the quantity of proposed and finalized regulations hitting the market. In this article, Think Advisor highlights some of the biggest rules impacting advisers this year, which includes:

• SEC Regulation Best Execution.
• FINRA Home Office Rule.
• SEC Marketing Rule.

The SEC Wants to Upend the Stock Market. Is It Worth It? (Authors – Bloomberg Opinion Editors, Wealth Management)

The SEC has proposed arguably the most “sweeping” changes to the stock market in years. As a direct response to what Chair Gensler is calling a fractured market, the SEC has proposed reforms which, “will send many retail orders to auctions, where more participants will have the opportunity to interact with them. Beyond that, it will allow public exchanges to use the same sub-penny price increments that wholesalers do, and it will strengthen rules requiring brokers to seek the most favorable terms for their customers.”

Cetera, LPL among critics in 55K comments on DOL’s independent contractor proposal (Author – Dan Shaw, Financial Planning)

The DOL has received 55,000 responses to their proposed rule, Employee or Independent Contractor Classification under the Fair Labor Standards Act. While the rule was introduced to protect gig workers, many investment advisers and broker-dealers feel it would have a negative impact on the business model within which they have functioned for decades, essentially undermining their ability to operate as independents. The sheer quantity of response to the proposed rule is relatively unheard of and indicates the market’s regard for how the proposal would impact the industry.

New Bill Requires SEC to Write E-Delivery Rule (Author – Melanie Waddell, Think Advisor)

A bipartisan bill, H.R. 9570, the Improving Disclosures to Investors Act, introduced recently by reps. Bill Huizenga, R-Mich., and Jake Auchincloss, D-Mass, would place requirements on the SEC to introduce ruling allowing for electronic delivery of all regulatory documents by financial firms.

“Eric Pan, president and CEO of the Investment Company Institute in Washington, added in another statement that the bill seeks to modernize the SEC’s regulatory framework and asks the agency to engage in rulemaking that permits “financial firms to provide disclosures to investors through electronic means.”

How financial advisors can protect clients and themselves from crypto risk (Author – Tobias Salinger, Financial Planning)

Adam Blumberg of Interaxis, Dan Kolber of Intellivest Securities and Jon-Jorge Aras of the Warren Law Group came together to speak on the impact of cryptocurrency in the market today, highlighting the need for balance between risk mitigation for clients and advisers and the opportunity for those interested in the potential of digital currencies as an investment strategy.

As Jon-Jorge put it, “Cryptocurrency doesn’t fit squarely or very nicely into the securities laws, the currency and commodity laws or really anything that we have presently in terms of regulation.”

Don’t forget to check out last week’s top RIA compliance news articles recapping the SEC’s sweeping examinations of its communication and record-keeping regulations, how advisers will approach compliance in 2023, the SEC’s new Regulation Best Execution rule, how firms perceive the SEC’s environmental, social and governance proposed requirements and the SEC’s plans to overhaul the way stocks are traded.