Without admitting guilt or even the facts of the case, Betterment has settled various allegations of improper recordkeeping and "window dressing" leveled by FINRA, to the tune of $400,000.
Participants in non-ERISA 403(b) plans could be considered "retail customers" under a section of the SEC's proposal, a law alert warns.
The brokerage firm will pay more than $15 million in settlement.
The Commission is also seeking public feedback on fund disclosure and the fees that intermediaries charge funds for delivering fund reports.
A new client alert published by the Wagner Law Group urges advisory firms to review and consider an update to anti-churning policies, now that FINRA and the SEC are both engaging in the matter.
This leaves the SEC’s revised conflict of interest standards for brokers and advisers as the leading alternative.
If an adviser reduced their fee due to the receipt of 12b-1 fees, the SEC might not ask for any disgorgement; for instance, the SEC says, if an adviser regularly charges an annual management fee of 1.25% of assets but lowered that to 1% in light of the 12b-1 fees, the SEC says it is unlikely to ask for any disgorgement.
Anticipating the DOL will not itself ask the 5th U.S. Circuit Court of Appeals to reconsider a crucial mid-March panel ruling that vacated the Obama-era fiduciary rule expansion, attorneys general and retiree advocacy organizations are speaking out, asking the full appellate court to reassess its decision.
The release of a thousand-page "best interest" rulemaking package by the SEC applying to all brokers and investment advisers is being hailed as a victory by some and a deep disappointment by others; either way, it's the start of another long chapter in the epic industry battle over federal conflict of interest regulations.
It will take time for the fully detailed picture to emerge, but the SEC voted late Wednesday to propose new conflict of interest standards for how broker/dealers and financial advisers label themselves and sell products under various fee structures to retail clients.
Amid a glut of retirement plan industry litigation and regulatory change, advisers are asking the twin questions of whether one owes a fiduciary duty to their client, and if so, what exactly those fiduciary duties entail.
Instead of making the disclosure on Form N-PORT on a quarterly basis, firms would discuss their liquidity risk programs in their annual statements.
However, the deadlines for creating a liquidity risk management program and to limit illiquid investments to 15% of a fund’s portfolio remain unchanged: December 1, 2018, for larger fund groups and June 1, 2019, for smaller fund groups.
Offering some preliminary commentary on the SEC’s newly announced adviser 12b-1 fee conflict of interest “amnesty” program, as it’s being referred to in the trade media, Wagner Law Group attorneys warn of the inherent risks in the self-reporting of violations.
Under the new “SCSD Initiative,” the SEC’s enforcement agents will recommend “standardized, favorable settlement terms” for investment advisers that self-report that they failed to disclose conflicts of interest associated with the receipt of 12b-1 fees by the adviser or an affiliated broker/dealer; the regulator further warns that advisers who fail to take advantage of this program will be punished more severely in the future.
The new tool aims to help advisers speak regularly with clients in efficient and seamless ways.
Regulatory developments in Nevada and New York show inaction at the federal level on clarifying advisers’ and brokers’ fiduciary duties is leading to a patchwork of state-by-state approaches to mitigating conflicts, real and perceived.
The SEC’s new Fixed Income Market Structure Advisory Committee aims to tackle difficult bond market liquidity challenges, with its first official meeting coming up this week.
More important than the fact that individual brokers or executives are being punished is the recognition that retirement plans and large institutional investors are routinely subject to fraud schemes.