More On Legal & Compliancefrom The Advisor's Professional Library
- Proxy Voting RIAs are not required to vote proxies on behalf of their clients. However, when an RIA does assume responsibility for voting proxies, the firm’s policies and procedures should help to ensure that votes are cast in the best interest of clients.
- Client Communication and Miscommunication RIA policies and procedures must specify what type of communications should be retained. The safest course of action is for RIAs to retain all communicationsto clients, from clients, and about client accounts. To comply with fiduciary obligations, communications must be thorough and not mislead.
The Securities and Exchange Commission published for public comment in October its Draft Strategic Plan outlining the Commission's strategic goals for fiscal years 2010 through 2015. The SEC says the draft plan surveys the forces shaping the SEC's environment and outlines over 70 initiatives designed to support its primary strategic goals. Comments on the proposal are due by November 16.
Besides strengthening the SEC's enforcement division, the strategic plan also sets out beefing up investment advisor and broker/dealer oversight. The Commission pointed to its consideration of rules designed to prevent political contributions from influencing the selection of investment advisers to the detriment of public pension plan clients, as well as rules that would provide additional safeguards to investors when an adviser has custody of client assets. The SEC says it will also "consider requiring those who provide investment advice to provide clients and prospective clients with clear, current, and more meaningful disclosure of their business practices, conflicts of interest, and backgrounds."