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.
- Agency and Principal Transactions In passing Section 206(3) of the Investment Advisers Act, Congress recognized that principal and agency transactions can be harmful to clients. Such transactions create the opportunity for RIAs to engage in self-dealing.
After the Minnesota Department of Commerce Securities Unit announced it would waive requirements that investment advisor representatives (IARs) who were employed as of Aug. 1 have a Series 65 or 66 license, FSI released a statement calling the move a “regulatory victory” for IARs.
Advisors who are already working can register in Minnesota without taking an exam. IARs who were not working before Aug. 1 will have to sit for the exam to register with the state, but they’ll have a grace period between Nov. 1 and the end of January to register.
FSI noted that it had met with the department to offer guidance on how best to implement the licensing requirement. “FSI members demonstrated that IARs who were providing investment advice in Minnesota prior to the requirement are well qualified by virtue of their experience and encouraged the department to waive the exam requirement for existing IARs and those with certain designations,” according to FSI.
“We appreciate the department’s willingness to work with us and our members and for its careful consideration of our comments and input,” the agency continued in its statement. “This is yet another example of how collaboration between regulators, the industry and investors leads to efficient solutions for all parties.”
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