More On Legal & Compliancefrom The Advisor's Professional Library
- Trading Practices and Errors When SEC-registered investment advisors conduct annual audits of firm policies and procedures, they should pay close attention to trading practices. Though usually not required to, state-registered advisors should look at their trading practices and revise policies that do not fully protect clients.
- Disaster Recovery Plans and Succession Planning RIAs owe a fiduciary duty to clients to prepare for disasters and other contingencies. If an RIA does not have a disaster recovery plan, clients financial well-being may be jeopardized. RIAs should also engage in succession planning, ensuring a smooth transaction if an owner or principal leaves.
Opinions vary as to what Senator Christopher Dodd's retirement, announced in January, will mean for financial services and healthcare reform. Knut Rostad, chairman of The Committee for the Fiduciary Standard, says that now that Dodd will "not have to be reckoned with after the election, industry opponents of the Consumer Financial Protection Agency will push even harder to reduce its firepower, or go with the alternative and weaker option promoted by the Heritage Foundation. To balance this loss for Main Street, pushing and repackaging the fiduciary standard language to resonate with Main Street makes sense."
Others like analysts at Concept Capital, a Washington Research Group, agree that the proposed Consumer Financial Protection Agency "could not get 60 votes in the Senate." Therefore, the analysts say they expect Dodd "to weaken the agency by putting the existing banking regulators in charge of it." Dodd will also compromise to get a Senate/House financial reform bill enacted, the analysts predict, because he would "like to have his name on a signature piece of legislation" before he leaves office.