According to University of Mississippi School of Law Professor Mercer Bullard, the question of who will regulate investment advisors “is the most important thing in advisors’ lives in the next year.”
In the SEC’s “Study on Enhancing Investment Adviser Examinations,” one of the recommendations for adding more oversight for registered investment advisors (RIAs) was to allow one or more self regulatory organizations to oversee them.
FINRA, the broker-dealer self-regulatory organization, has stepped up to volunteer that it would like to oversee not only broker-dealers (BDs), and dually registered BD-RIAs, but independent RIAs as well. Bullard (left) sees FINRA regulation of the independent RIAs as the “worst case scenario.”
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Instead, he and a group of his law students at Ole Miss have proposed a startup SRO for RIAs, SROIIA, the Self-Regulatory Organization for Independent Investment Advisors.