More On Legal & Compliancefrom The Advisor's Professional Library
- The Few and the Proud: Chief Compliance Officers CCOs make significant contributions to success of an RIA, designing and implementing compliance programs that prevent, detect and correct securities law violations. When major compliance problems occur at firms, CCOs will likely receive regulatory consequences.
- 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.
The Financial Industry Regulatory Authority announced Tuesday that it has enhanced BrokerCheck to allow investors to now search both the BrokerCheck and Investment Adviser Registration Depository record of any securities professional or firm directly on the FINRA home page.
The BrokerCheck search results, FINRA says, are presented in a graphical timeline, illustrating a more user-friendly view of an industry professional’s employment status and history, industry registrations, and any reportable events such as customer disputes or disciplinary actions that may have occurred during his or her career.
FINRA says that it will also make the new BrokerCheck widget available to third-party websites, allowing visitors to those websites direct access to securities professionals’ or firms’ BrokerCheck or IAPD reports without having to visit the FINRA or Securities and Exchange Commission websites.
The IARD is an electronic filing system for investment advisors sponsored by the SEC and the North American Securities Administrators Association, with FINRA serving as the developer and operator of the system.
“Investors using BrokerCheck will encounter a more user-friendly interface that allows them to quickly find information that can help them decide if an investment professional is right for them,” said Derek Linden, FINRA Executive Vice President, Registration and Disclosure, in a statement.
Jonathan Henschen, with the broker-dealer recruiting firm Henschen & Associates, says that he uses BrokerCheck daily and finds the updated version saves him “time from having to go to the ‘detailed report’ unless you want details on disclosure events.”
Time at firms, Henschen says, “is represented by timelines and red dots show up along the timeline as to when disclosure events occurred. For a quick snapshot the new system is a time saver for someone like me that is neck-deep in the business.”
However, he says an average client “reading details on disclosures or seeing high job frequency [changes] will typically lack discernment of the industry jargon on disclosures and have little understanding that job changes often times can be a result of firms being sold, closed or merged.” More information, therefore, “does not ensure more understanding or objectivity.”
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