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 Commission Practices and Soft Dollars RIAs should always evaluate whether the products and services they receive from broker-dealers are appropriate. The SEC suggested that an RIAs failure to stay within the scope of the Section 28(e) safe harbor may violate the advisors fiduciary duty to clients, so RIAs must evaluate their soft dollar relationships on a regular basis to ensure they are disclosed properly and that they do not negatively impact the best execution of clients transactions.
Senate Republicans are urging regulators to slow down implementation of Dodd-Frank by extending the comment periods on their rule proposals and conducting more “rigorous” analysis on those rules—including one on putting brokers under a fiduciary standard of care.
As Sen. Tim Johnson, D-S.D., chairman of the Senate Banking, Housing, and Urban Affairs Committee conducts his first hearing on Thursday on regulators’ implementation of Dodd-Frank, Senate Republicans sent a letter on Tuesday to all the top regulators asking that they “not sacrifice quality and fairness in exchange for speed,” in fulfilling their statutory mandate under Dodd-Frank.
The letter was sent to Federal Reserve Chairman Ben Bernanke; Securities and Exchange Commission (SEC) Chairman Mary Schapiro; Gary Gensler, chairman of the Commodities Futures Trading Commission (CFTC); Sheila Bair, chairman of the Federal Deposit Insurance Corp. (FDIC); and John Walsh, acting director of the Comptroller of the Currency.
The Republican Senators, including Richard Shelby, R-Ala., ranking minority member on the committee, and Michael Crapo, R-Idaho, asked regulators to extend their comment periods on proposed rules under Dodd-Frank from 40 days to 60.
The Senators pointed to the request for a more rigorous economic analysis raised by SEC Commissioners Kathleen Casey and Troy Paredes in the SEC’s study under Section 913 of Dodd-Frank, regarding putting brokers under a fiduciary standard of care.