Independent broker/dealer compliance officers are griping that federal and state securities regulators are piling on so many regulations and making so many inquiries that they don’t know what they should do first. But any hopes they might have had for relief were dashed during the Financial Planning Association’s annual B/D conference in Huntington Beach, California.
Officials from the Securities & Exchange Commission, National Association of Securities Dealers, and Connecticut’s securities department told compliance execs Jan. 24 that they are already targeting new areas of concern even as they ratchet up the pressure for fuller disclosure of mutual fund payments for shelf space at broker/dealer firms.
Asked what major compliance issues would be in the spotlight by the time next year’s B/D meeting rolls around, Robert Errico of the NASD said he expected regulators will be seeking “heightened supervision” of registered representatives as well as taking a closer look at B/D sales practices. In addition, he and SEC attorney John Walsh both indicated that regulators plan increased scrutiny of B/D e-mail retention. “This is going to be a hot topic,” said Walsh.
The Financial Services Institute, the new organization representing independent B/D firms that split off from the FPA, has a healthy budget of $600,000 to $700,000 for its first year of life. But a number of industry executives are wondering where the money will come from.