More On Legal & Compliancefrom The Advisor's Professional Library
- Do’s and Don’ts of Advisory Contracts In preparation for a compliance exam, securities regulators typically will ask to see copies of an RIAs advisory agreements. An RIA must be able to produce requested contracts and the contracts must comply with applicable SEC or state rules.
- Privacy Policies and Rules Whether an RIA is SEC or state-registered, the firm must have policies and procedures in effect to protect clients privacy. Policies and procedures should explicitly require an RIA to send out its privacy notice each year.
The SEC and Department of Labor (DOL) agreed July 29 to share information on retirement and investments in what they said was a bid to protect the $5.8 trillion in retirement assets of American workers, retirees, and their families held in employee benefit plans.
The memorandum of understanding (MOU) establishes a process for the department's Employee Benefits Security Administration and SEC staffs to share information and meet regularly to discuss matters of mutual interest, according to a release announcing the agreement. These include examination findings and trends, enforcement cases, and regulatory requirements that impact the missions of both agencies. The DOL has oversight over 401(k) and other retirement plans as well as plan participants, while the SEC oversees, among other areas, brokerages, investment advisors, and mutual funds.
"With a growing number of seniors focused on managing their own 401(k) plans, it's important to improve disclosure to give them the information they need and in a form they can use," SEC Chairman Christopher Cox said. "To accomplish this, the Department of Labor and the SEC are committed to coordinating closely on their behalf. This enhanced coordination will greatly benefit the millions of hardworking Americans who are saving and investing for their retirement as well as those who have already retired."
Both agencies will designate points of contact in their regional offices to facilitate communications among staff on enforcement and examination matters, the release states. "The agreement also will expedite the sharing of non-public information regarding investment advisors and other subjects of mutual interest between the two agencies. Additionally, DOL and SEC will cross-train staff under the agreement with the goal of enhancing each agency's understanding of the other's mission and investigative jurisdiction."