RIA Compliance and Practice Management Blog

They say no man is an island. A theory which, applies itself quite suitably to a registered investment adviser (RIA) firm’s compliance program.

How?

While your chief compliance officer (CCO) may lead the compliance charge, they should, by no means, be an island unto themselves, solely responsible for the compliance strategy (and success) of your firm. In order to truly remain in compliance with the Securities and Exchange Commission (SEC), as well as state level regulatory bodies, a firm must define and support a culture which prioritizes compliance.

Social media is one of the simplest ways for a registered investment adviser (RIA) firm to build their brand. It’s free, it’s easy and it’s ripe with opportunity.

But it can also be dangerous for advisers who don’t know what they’re doing. Indeed, among many changes, the newly updated Marketing Rule revised Form ADV to require additional detail about an RIA’s marketing practices. This information will undoubtedly be factored into regulators’ examination and enforcement methodology.

There is no doubt, complying with the myriad rules and regulations of the Securities and Exchange Commission (SEC) or state regulatory bodies requires significant investment in both time and money. For registered investment adviser (RIA) firms, the cost can be quite high, depending in part, on factors like what types of products and services they offer.

Because of this steep cost, some compliance teams, particularly those who serve firms which have not experienced significant regulatory concerns, may see reluctance or even resistance to funding the compliance program from senior leaders who see the chief compliance officer’s (CCO) efforts as a drain on firm profits.

Each Friday, we are giving you our weekly report highlighting the top compliance news articles from various industry news publications. We have selected the most relevant and important news articles related to registered investment adviser (RIA) compliance and regulatory issues. This week's recap focuses on anticipation around regulations from the Department of Labor (DOL), how you can help elderly clients stay clear of  scams and how the ComplyConnect Conference & Expo met the needs of wealth management professionals.

Here are our top investment adviser compliance articles for the week of Nov. 25, 2022:

For a compliance professional to successfully mitigate the risk of noncompliance at their investment firm, they must stay ahead of trends and proactively equip their firm with the appropriate compliance protocols and procedures. And in today’s digital-first environment, that often means investing in the right technology.

In our propriety research and industry analysis, we examined how financial firms are functioning amid heighted regulatory activity, what risks are taking priority and where investments are being made. In doing so, we aggregated data and insight into not only how investment firms are using compliance technology now, but how they will do so in the future.

As a registered investment adviser (RIA), your firm is subject to various rules and regulations – each put in place to protect the firm, its employees and investors.  

One of the most important areas for investment advisory firms to monitor is potential or active conflicts of interest. Today, we’re discussing the most common areas related to conflicts of interest and what firms can do to both prevent and/or address these situations. 

On Nov. 22 2022, RIA in a Box released its new SEC Rule Checklist, created in response to the Securities and Exchange Commission’s (SEC) amended Rule 206(4)-1, under the Advisers Act, which addresses registered investment adviser (RIA) firms marketing their services to clients and investors (The Marketing Rule). The SEC Rule Checklist is accessible to clients through the MyRIACompliance platform, and can be located within the existing Marketing Rule module.

As a registered investment adviser (RIA) chief compliance officer (CCO), you have a lot on your plate. Being responsible for the compliance functionality within your RIA means a lot of different things, however, what it doesn’t mean? That you are solely responsible for complying with all RIA compliance requirements as set out by the state or Securities and Exchange Commission (SEC).

So, who is? Simple, everyone.

The Securities and Exchange Commission (SEC) have officially released their enforcement actions and the associated fines and penalties for fiscal year 2022. And the result? A staggering $6.4 billion in penalties and disgorgement resulting from 760 SEC enforcement actions. As we wrap FY22, what can registered investment advisers (RIAs) learn from such steep penalties? Accountability is everything.

Each Friday, we are giving you our weekly report highlighting the top compliance news articles from various industry news publications. We have selected the most relevant and important news articles related to registered investment adviser (RIA) compliance and regulatory issues. This week's recap focuses on the Securities and Exchange Commission’s (SEC) new Marketing Rule and how firms can best adhere to it, registered investment advisers (RIA) intentions to invest more into their compliance programs and the cost for firms to comply with the SEC’s environmental, social and governance (ESG) proposed regulations.

Here are our top investment adviser compliance articles for the week of Nov. 11, 2022: