More On Legal & Compliancefrom The Advisor's Professional Library
- 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.
- Conducting Due Diligence of Sub-Advisors and Third-Party Advisors Engaging in due-diligence of sub-advisors isnt just a recommended best practice it is part of the fiduciary obligation to a client. An RIA should be extremely reluctant to enter a relationship with a sub-advisor who claims the firms strategy is proprietary.
The Securities and Exchange Commission continues to add staff to its newly established Division of Risk, Strategy, and Financial Innovation, with Gregg Berman recently being named a senior policy advisor in the new division.
Berman comes to the SEC from RiskMetrics Group, a company that focuses on risk management, corporate governance, and financial research and analysis. According to the SEC, Berman held several senior positions during his 11-year tenure at RiskMetrics Group, most recently serving as the head of the global risk business. He also held positions in strategic development, and earlier served as the company's head of market risk. Berman will start his new position the week of September 28.
University of Texas School of Law Professor Henry Hu was named director of the new division in mid-September. The new SEC division combines the Office of Economic Analysis, the Office of Risk Assessment, and other functions that are meant to provide the Commission with sophisticated analysis that integrates economic, financial, and legal disciplines. The SEC says that the division's responsibilities cover three broad areas: risk and economic analysis; strategic research; and financial innovation. "This new division will enhance our capabilities and help identify developing risks and trends in the financial markets," said SEC Chairman Mary Schapiro, in a statement announcing the new division.
Hu said in a release that Gregg will have much to contribute to the new division given his "PhD in physics from Princeton and experience in nuclear research, hedge fund management, and financial modeling and analysis."
Berman said in the same release that he looks forward "to using an interdisciplinary approach, one involving economics, finance, and law, in a way that fairly addresses the needs of Main Street as well as Wall Street."
Prior to his work at RiskMetrics Group, Berman co-managed a private hedge fund, worked for an investment management company, and conducted research in experimental nuclear physics.