From the June 2010 issue of Investment Advisor • Subscribe!

The Regulators Never Sleep

More On Legal & Compliance

from 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.
  • Books and Records Rule Thorough and complete books and records enable RIAs to demonstrate that they have fulfilled their fiduciary obligations to clients and complied with applicable rules and regulations.

The Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) announced May 10 that the two agencies have formed a joint committee that will address emerging regulatory issues. The Joint CFTC-SEC Advisory Committee on Emerging Regulatory Issues was one of the 20 recommendations included in the agencies' harmonization report issued last year.

The two agencies say that the joint Committee will develop recommendations on emerging and ongoing issues relating to both agencies. The first item on the committee's agenda was conducting a review of the market events of Thursday, May 6, in which the Dow Jones dropped 1,000 points.

The SEC and CFTC say that the Committee's charter provides for a broad scope of interest, including:

o Identifying of emerging regulatory risks.

o Assessing and quantifying the impact of such risks and their implications for investors and market participants.

o Furthering the SEC's and CFTC's efforts on regulatory harmonization.

Chairman Mary Schapiro of the SEC and Chairman Gary Gensler will serve as co-chairs of the Joint Committee.

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