Gary Gensler, chairman of the Commodity Futures Trading Commission (CFTC), said during the CFTC’s joint meetings with the SEC in early September (to discuss how to harmonize both agencies’ regulations) that three broad areas must be addressed. First, he said, the gaps must be closed that exist between the two agencies’ financial regulatory authorities, including over-the-counter derivatives. Second, the agencies must ensure that regulatory overlap only exists where it is beneficial, such as in joint enforcement, and not when it can be used for regulatory arbitrage. Third, Gensler argued that it’s “paramount to explore where it is appropriate to bring consistency” to the two agencies’ regulation over similar products, practices, and markets. Gensler highlighted the 12 regulatory changes that participant testimony and panelists at the hearings said the two agencies should consider:
o product listing, regarding self-certification or prior approval; exchange and clearinghouse rules, also regarding self-certification or prior approval; risk-based (“portfolio”) margining with cross-margining of futures and securities products;
o fungibility and competition among execution platforms;
o uniform customer account and bankruptcy/insolvency regime;
o market structure, regarding separate versus linked markets;
o standards for prosecuting market manipulation;
o punishing insider trading in derivatives markets;
o customer protection regarding suitability or disclosure;
o customer protection regarding fiduciary obligations for intermediaries;
o mutual recognition of entities regulated by foreign jurisdictions;
o principles-based versus rules-based regulatory oversight.
USAdvisors Network, based in Eden Prairie, Minnesota, which provides financial planning and insurance integration for the banking, accounting, and insurance industries, signed an agreement for its affiliated advisors and institutions to join independent broker/dealer Securities America as a branch office. Securities America senior VP and Director of Branch Development Gregg Johnson said in a statement that the integration of USAdvisors Network will increase the number of financial institutions Securities America serves to more than 100. Johnson said that Securities America is also seeing strong results in its “organic” recruiting efforts. GDC is up over 40% compared to 2008, Johnson said, and the number of new advisors joining Securities America is up over 56%. “Among new advisors, the number coming from wirehouse broker/dealers has increased by over 42%,” he said. “The number of advisors recruited from other independent broker/dealers has increased by 93%.”
Westrock Group, Inc., a New York-based financial services holding company with independent broker/dealer, asset management, and wealth management subsidiaries, recently announced that the firm has been acquired by LBC Western Holdings, a company 100%-owned by Cin South Dakota. With this transaction, Westrock Group becomes the first Native American-owned full service financial services business. Through Westrock’s Tribal Services Advisory group, Westrock will begin to provide financial advisory services to the Lower Brule Sioux Tribe and other tribes throughout the country. The Tribal Services Advisory group will be headed by Dennis Ickes, director of tribal services. He will be joined by Dr. Gavin Clarkson, director of tribal finance at Westrock, a professor of law at the University of Houston Law Center and a member of the Choctaw Nation of Oklahoma. In a separate announcement, Westrock Asset Management announced the formation of a joint venture with Creighton Capital Management, a quantitative asset management firm founded by Jim Creighton, a former global CIO Barclays Global Investors, Northern Trust, and Deutsche Asset Management.