More On Legal & Compliancefrom The Advisor's Professional Library
- Risk-Based Oversight of Investment Advisors Even if the SEC had a larger budget and more resources, it is doubtful that the Commission would have the resources to regularly examine all RIAs. Therefore, the SEC is likely to continue relying on risk-based oversight to fulfill its mission of protecting investors.
- 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.
The Financial Industry Regulatory Authority announced Thursday that former Securities and Exchange Commission Chairwoman Elisse Walter has been elected to FINRA’s board as public governor, along with Susan Wolburgh Jenah, president and CEO of the Investment Industry Regulatory Organization of Canada (IIROC).
Also elected at FINRA’s 2014 annual meeting in Washington, which was closed to the public, were a small-firm governor, Mark Cresap, president and owner of Cresap Inc., and a large-firm governor, Gregory J. Fleming, president of Morgan Stanley Wealth Management and Morgan Stanley Investment Management.
Cresap is newly elected, while Fleming has been a large-firm governor for the past two years and was re-elected to a second term.
FINRA is overseen by a 24-person Board of Governors, with 13 seats held by public governors and 10 by industry governors. FINRA’s CEO has the remaining seat. FINRA governors are appointed or elected to three-year terms and may not serve more than two consecutive terms.
Walter was the 30th chair of the SEC, holding the post from Dec. 14, 2012, to April 10, 2013. Before her chairmanship, she was appointed an SEC commissioner by President George W. Bush and was sworn in on July 9, 2008. Earlier, Walter was senior executive vice president of regulatory policy and programs at FINRA.
Check out SEC Swears In 2 Commissioners; FINRA Names New Governors on ThinkAdvisor.