More On Legal & Compliancefrom 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.
- 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.
While the obvious "big challenge" the agency faces is implementing the scads of changes set out in the reform bill, the SEC is already busy setting up new offices at the securities regulator to police the market. The SEC announced on July 16 that the SEC will create three new specialized units within the agency's Division of Corporation Finance--the division that reviews public company filings--to focus on large financial institutions, asset-backed securities and other structured products, and securities offering trends.