Tag Archives: Regulation Best Interest

Reg BI Webinar Overview

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We recently announced a Regulation BI webinar that was held in late May. Below is the summary of that webinar from Justin Schleifer of Aspect Advisors. Please reach out to us or Aspect Advisors if you’d like more information on Reg BI or the webinar.

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Thank you – Reg BI webinar overview

Thank you for attending our Regulation Best Interest (Reg BI) webinar last week.  I would also like to extend many thanks to my fellow panelists, James Dombach and Paul Merolla from the law firm Murphy & McGonigle, and to Bart Mallon of Cole-Frieman & Mallon for hosting.  The webinar provided an overview of Reg BI obligations, defined key terms, reviewed the SEC’s OCIE guidance regarding regulatory expectations, and provided practical suggestions for implementation by broker-dealers (BDs) and registered investment advisers (RIAs) for the June 30 deadline for compliance. 

Here are the key take-aways about Reg BI:

  • When making a recommendation of any securities transaction or investment strategy to a retail customer (as defined), BDs must act in the best interest of the retail customer at the time the recommendation is made.
  • 4 components of obligation:
    • Disclosure:  effective Form CRS content and delivery for BDs and RIAs;
    • Care:  sufficiently understanding the product and the customer;
    • Conflicts of Interest:  review, mitigation/elimination, and disclosure; and
    • Compliance:  effective controls and best practices.
  • SEC Office of Compliance Inspections and Examinations (“OCIE”) expectations include:
    1. Assessment:  Has the Firm sufficiently analyzed and documented its business practices, its registered representatives, and its products to make necessary disclosures?
    2. Implementation: BDs and RIAs are required to provide a brief relationship summary (Form CRS) including appropriate disclosures to both new and existing retail investors.
    3. Documentation:  Firms must have policies and procedures that assess potential risks, rewards, and costs of recommendations in light of a retail customer’s investment profile; how the 4 components of obligation will be met; and the process for Form CRS delivery.

If you (or your colleagues) would like to review any of the webinar content, please email Amanda Brown for a link to the recording.  If you have any questions about Reg BI or need advice about how to implement at your firm, please reach out to any of our panelists.

We hope you enjoyed this event and if you have any feedback, we would love to hear from you.  We look forward to seeing you at our next event!

Best regards,

Justin Schleifer

President of Aspect Advisors

Aspect Advisors

Aspect Advisors is a regulatory compliance consulting firm that provides customized compliance solutions for complex challenges. Our clients are financial service innovators, including fintech companies, registered investment advisers (RIAs), broker-dealers and private fund managers. Our back-office services include regulatory registrations and filings, compliance policies and procedures, conducting annual reviews, outsourced Chief Compliance Officer/FinOP support, and other bespoke items.

Murphy & McGonigle

Murphy & McGonigle is a law firm that serves the litigation, enforcement defense, and regulatory needs of clients across the full spectrum of the financial services industry – from national banks, broker-dealers, investment advisers, and hedge funds, to national and international securities markets and exchanges.

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Bart Mallon is a founding partner of Cole-Frieman & Mallon LLP. Cole-Frieman & Mallon is a boutique law firm focused on providing institutional quality legal services to the investment management industry. For more information on this topic, please contact Mr. Mallon directly at 415-868-5345.

Regulation BI Webinar Announced

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Aspect Advisors and Cole-Frieman & Mallon Both Participating

The below is a press release announcing the Regulation Best Interest webinar next week. All are welcome to join.

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Aspect Advisors Presents Regulation Best Interest Webinar

Reg BI Compliance Implementation for Broker-Dealers and Investment Advisers

SAN FRANCISCO (PRWEB) MAY 21, 2020

Aspect Advisors, a regulatory compliance consulting firm, will be presenting best practices for broker-dealers and investment advisers subject to the new Regulation Best Interest (“Reg BI”) requirements ahead of the June 30 deadline for compliance. The presentation will be made through a live webinar, open to all who register, on May 28th at 1:00pm Eastern time and will feature expert speakers on the new regulation.

Reg BI establishes a new “best interest” standard of conduct for broker-dealers when making recommendations to retail customers regarding any securities transaction or investment strategy involving securities and includes four specified components to the obligations: disclosure, care, conflict of interest, and compliance. The regulation also requires broker-dealers and investment advisers to provide a brief relationship summary (Form CRS) to retail investors.

The May 28 webinar will be a “beyond-the-basics” deep dive discussion into how investment management firms can implement Reg BI requirements. Topics will include: the SEC’s OCIE guidance regarding regulatory expectations, common questions from both a compliance and legal perspective, practical strategies for implementation of requirements, and a question and answer period with participants.

“We have seen the government and regulators pull back on the implementation of various regulations during the COIVD-19 crisis,” said Justin Schleifer, president of Aspect Advisors and panelist. He continued, “however, it appears that Reg BI will not be subject to delay and so investment management firms need to be prepared for the June 30 deadline with real world solutions.”

The panelists will include James Dombach and Paul Merolla from the law firm Murphy & McGonigle and Justin Schleifer from Aspect Advisors. Host of the panel Bart Mallon, from the law firm Cole-Frieman & Mallon, stated “the goal of this panel is to provide broker-dealers and investment advisers with practical advice on this important new regulation.” He went on to state that “implementation in normal times would be involved so this webinar is both timely and important.”

Representatives from financial firms can sign up for the webinar here:
https://webinar.ringcentral.com/webinar/register/WN_FOEYC_mhQV68d2sIx6rIDg

About Aspect Advisors:
Aspect Advisors is a regulatory compliance consulting firm that provides customized compliance solutions for complex challenges. Our clients are financial service innovators, including fintech companies, registered investment advisers (RIAs), broker-dealers and private fund managers. Our back-office services include regulatory registrations and filings, compliance policies and procedures, conducting annual reviews, outsourced Chief Compliance Officer/FinOP support, and other bespoke items.

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Bart Mallon is a founding partner of Cole-Frieman & Mallon LLP. Cole-Frieman & Mallon is a boutique law firm focused on providing institutional quality legal services to the investment management industry. For more information on this topic, please contact Mr. Mallon directly at 415-868-5345.