RIA Compliance and Practice Management Blog

Top RIA Compliance News Articles for the Week of December 21, 2018

Posted by RIA in a Box

Dec 28, 2018 4:28:13 PM

sec 2019 RIA audit priorities

Each week we’re 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 Commissions ("SEC") 2019 regulatory focus areas, the Financial Industry Regulatory Authority's ("FINRA") and the SEC's pitfalls for Chief Compliance Officers, and cybersecurity best practices. Check back each week for the latest list of top stories.

Here's our top investment adviser compliance articles for the week of December 21, 2018:

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  1.  SEC: Regulation to watch in 2019 (Author-  Jessica Mathews, FinancialPlanning)

According to a recent post by Jessica Mathews, the SEC will focus on issues such as cybersecurity and cryptocurrencies in its 2019 examinations.  The agency will also further investigate compliance procedures and internal policies. In addition to focusing on these issues, examinations will also happen more frequently. The regulator’s goals for the next four years include addressing rules that may not be functioning as originally designed. According to SEC Chariman Jay Clayton, “In today’s global and rapidly changing markets, it is important for the SEC to continually analyze and seek feedback from investors and others about where rules are, or are not, functioning as intended.”

  1. FINRA's Cybersecurity Best Practices (Author - Samuel Steinberger, WealthManagement.com)

While there is not a uniform approach to tackling cybersecurity, FINRA released a report outlining cybersecurity best practices in order to help advisors determine a strategy that works best for their firm. Their recent cybersecurity best practices report includes suggestions for areas including mobile devices, phishing attacks, insider threats, and penetration-testing programs. These suggestions stemmed from FINRA’s observations of challenges that firms have faced in their cybersecurity protocols.

  1. Scams Continue in Year of 1,000 Data Breaches (Author- Roy Urrico, ThinkAdvisor)

After the large volume of data breaches, scams, and personal information exposure incidents in 2018, experts say that these threats are likely increase in 2019 as hackers continue to evolve and become more sophisticated. The Identity Theft Resource Center ("ITRC") shares methods that scammers have used and will continue to use to steal money and identify personal information in 2019. Roy Urrico offers a few proactive measures to take in 2019 to protect information including freezing credit, shredding unwanted mail, and being vigilant of suspicious emails.

  1. Top FINRA And SEC Pitfalls For CCOs in 2018 (Author- Tracey Longo, Financial Advisor Magazine)

Tracey Longo reflects on 2018 and breaks down Evershed Sutherland’s year-end analysis to find the most common and significant cases FINRA and the SEC addressed with Chief Compliance Officers this past year. Evershed Sutherland concluded that sufficient supervision was a leading factor that caused regulatory blunders for CCOs. In many cases, although the CCO did not oversee the aspects that caused their compliance efforts to astray, the CCO was still held responsible because they are often the only ones at the firm that have the ability to develop and update procedures for everyone in the firm. Other areas that caused problems for CCOs were insufficient disclosures, policies and procedures related to performance, anti-money laundering, written supervisory procedures, and custody rules.

  1. Regulatory Changes to Watch: Taxes, Retirement, Fiduciary Rules (Author- Melanie Waddell, FinancialPlanning)

As written by Melanie Waddell of ThinkAdvisor, “Complying with anticipated retirement and tax-related changes as well as fiduciary-related standards from the SEC and the Labor Department will top advisors’ and broker-dealers’ regulatory to-do lists in 2019.”  In this article, Chairman Kevin Brady explains the benefits to the Retirement, Savings, and Other Tax Relief Act of 2018 and the Taxpayer First Act of 2018. In addition, Karen Barr, President and CEO of the Investment Adviser Associations ("IAA"), warns advisers against upcoming regulatory changes they should be prepared for.

Download Our Free RIA Cybersecurity Compliance Checklist

Don't forget to check out last week's top RIA compliance news articles on the SEC's 2019 examination priorities, FINRA's updated cybersecurity best practices report, and the SEC's recent risk alert on text messaging and electronic communication. Be sure to check back next Friday for next week’s top articles! 


Topics: RIA Compliance

RIA in a Box LLC is not a law firm, investment advisory firm, or CPA firm. RIA in a Box LLC does not provide legal advice or opinions to any party or client. You should always consult your relevant regulatory authorities or legal counsel if applicable.

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