More On Legal & Compliancefrom The Advisor's Professional Library
- Registration Requirements for Investment Advisor Representatives (IARs) When individuals launch an advisory firm, they must avoid marketing themselves or the firm as investment advisors before they are properly approved and registered. Otherwise, they are subject to severe penalties.
- Preventing and Dealing with Client Complaints Although the SEC has not provided specific guidance on how client complaints should be handled, a firms policies and procedures should provide clear direction how to do so, as neglecting complaints can exacerbate a bad situation.
The Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) announced that the two regulatory agencies will hold joint meetings in September to seek input from the public on harmonization of market regulation.
The first meeting on September 2 will be held at the CFTC, while the second meeting, to be held September 3, will be at the SEC. The White House requested that the SEC and CFTC send a report to Congress by September 30 "that identifies all existing conflicts in statutes and regulations with respect to similar types of financial instruments and either explains why those differences are essential to achieve underlying policy objectives with respect to investor protection, market integrity, and price transparency or makes recommendations for changes to statutes and regulations that would eliminate the differences."
SEC Chair Mary Schapiro said in a statement that the "joint meetings will build on the progress the CFTC and SEC have made on designing a framework to regulate OTC derivatives. It will move us further down the road of harmonizing our regulations to increase transparency, reduce regulatory arbitrage and rebuild confidence in our markets."
CFTC Chairman Gary Gensler noted in the same statement that "harmonizing our regulatory policies will improve market integrity by applying consistent standards to market participants. There are three areas where this review will most benefit the American public: to address gaps between the two agencies' financial regulatory authorities, to assess the effects of regulatory overlap and to bring appropriate consistency to the two agencies' regulation over similar products, practices and markets."