More On Legal & Compliancefrom The Advisor's Professional Library
- 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.
- Preventing and Dealing with Client Complaints Although the SEC has not provided specific guidance on how client complaints should be handled, a firms policies and procedures should provide clear direction how to do so, as neglecting complaints can exacerbate a bad situation.
The North American Securities Administrators Association announced Tuesday that it has developed a coordinated review program for investment advisors switching from federal to state oversight as mandated by the Dodd-Frank Wall Street Reform and Consumer Protection Act.
Dodd-Frank requires investment advisors with assets under management of between $25 million and $100 million to switch from federal to state registration by mid-2012.
The Investment Adviser Coordinated Review Program is open to SEC-registered investment advisors switching their registration to between four and 14 states, NASAA says. Under Dodd-Frank, investment advisors registered in 15 or more states can remain with the SEC. The program will conclude on March 30, 2012.
“This initiative provides investment advisors registering in multiple states with an easier way to navigate the switch to state registration and gives states an opportunity to coordinate and resolve issues about potential problems with applicants,” said Jack Herstein (left), NASAA president and assistant director of the Nebraska Department of Banking and Finance Bureau of Securities, in a statement.
To participate in the program, eligible investment advisors must complete and submit the Coordinated Review Form found in the IA Switch Resource Center on the NASAA website in addition to filing all materials required by the states in which the advisor is applying for registration.
Herstein adds that there is no additional cost to use the program. “Advisors will be subject only to the filing fees specified by the states in which the investment advisor is applying for registration,” he said, noting that NASAA has waived IARD system fees for 2011 and 2012.
According to NASAA, “the states where the investment advisor has filed a registration application will conduct a coordinated review of the investment advisor’s registration materials.” After completion of the review, “the advisor will be informed of the deficiencies, if any, that must be resolved before the registration will be approved,” NASAA states.