RIA Compliance and Practice Management Blog

Top RIA Compliance News Articles for the Week of January 8th, 2021

Posted by RIA in a Box

Jan 15, 2021 3:57:58 PM

Top RIA Compliance Articles: Paycheck Protection Program, advisor marketing practices, and SEC Whistleblower RulesEach 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 Paycheck Protection Program ("PPP") reopening, advisor marketing practices, and the Securities' and Exchange Commission's ("SEC") Whistleblower Rules.

Here's our top investment adviser compliance articles for the week of January 8th, 2021:

Download our 2020-2021 RIA Firm Registration Renewal Infographic

           1. SBA and Treasury reopen Paycheck Protection Program (Author – Michael Cohn, FinancialPlanning) 

The CARES Act originally launched in 2020 with the Paycheck Protection Program to aid businesses affected by the challenges brought on by the Covid-19 pandemic. The program, open through March 31st, 2021 was reopened and updated. “First draw” loans were for small businesses that did not utilize the program in 2020, while the “second draw” is now available as of this Wednesday. The Small Business Association (SBA) released updated guidance outlining changes to the PPP that improve the effectiveness and accessibility or the program. The article overviews main updates and general eligibility of for the PPP program. These enhancements will continue to help small businesses and their workers most impacted by the pandemic.

         2. Advisors' Obsession with Traditional Marketing (Author – Brandon Moss, WealthManagement.com)

In this article, Brandon Moss discusses how to think differently about RIA firm marketing saying, “advisors who turn to traditional marketing to get them past growth hurdles are destined for immense disappointment.” He goes into depth regarding the following three topics of approach to a firm’s marketing strategy: 1) delivering consistent and reliable service; 2) investing in technology for automated advice that is faster and more convenient; 3) referrals influenced by timely client communications. A client experience that has digital capabilities and is accessible is going to outperform firms that do not focus on the client experience. When making website refreshes, and approaching social media strategies, focus on the client experience and the growth impact will follow.

       3. Lawyer Sues SEC Over New Whistleblower Rules (Author – Melanie Waddell, ThinkAdvisor)

Jordan Thomas, prominent whistle blower attorney, filed a lawsuit against the SEC “to vacate what he says are ‘illegal’ changes to the agencies whistleblower rules, which ‘undermine the integrity and effectiveness’ of the program.” Changes came in September 2020 after a 3-2 vote by the commission, adding uncertainty for whistleblowers weighing the costs and benefits to coming forward with information. The changes ultimately give the SEC the power to decrease the monetary size and number of whistleblower awards it issues. The SEC explained the new rule was adopted by the commission to have authority to lower whistleblower awards, so they aren’t “unnecessarily large”, where the lawsuit argues “courageous whistleblowers have put their careers and lives on the line to assist the commission” backing that the previous rules under the Dodd-Frank Act were enticing enough to create a successful whistleblowing program. The article continues to discuss the future for the whistleblowing rule, the changing of the SEC chairman’s influence, and additional statements excerpted from the lawsuit.

         4. Embrace the Shift Toward Fiduciary-Driven Financial Services (Author – Andrew Winnett, ThinkAdvisor)

In this article, Winnett discusses frequently asked questions among prospects and clients who could benefit from emerging fiduciary standards. The public’s awareness of the “fiduciary” term has been on the rise. Recent debates over the conflict of interest rule partnered with more consumers discovering the benefits of working with a fiduciary is creating a client pool seeking a high bar in wealth management. Staying ahead of the fiduciary trend means advisors must examine relevant questions clients will ask and prepare their responses so they meet changing client expectations. Additionally, as the RIA industry continues to grow, Winnett notes “becoming a fiduciary is not a marketing ploy. . . . It’s a symbol of your commitment to always putting your clients goals, needs and desires first.”

        5. Five 2021 Technology Trends Changing Advisor-Client Engagement (Author – Christopher Robbins, Financial Advisor Magazine)

The past year brought about a lot of forced change, undoubtedly affecting future norms in the wealth management industry. This article discusses five technology trends expected to further influence advisor practices in 2021 as the new year is underway. Notably, the third topic in Robbins’ article, regulators are catching up to new technology. Covid-19 quickened the use of digital communications and RIAs also rushed to create digital content as office to client relations were predominantly remote. As the volume of digitization increases, so does the compliance demand. Regulators will now act with urgency auditing retention and archiving best practices for marketing content and digital communications during a firm’s regulatory audit.

Learn More About Our Cybersecurity Platform

Don't forget to check out last week's top RIA compliance news articles that focus on the SEC's new modernized marketing rule, tougher industry regulations expected in 2021, and PPP loans.

Topics: RIA Operations, RIA Compliance, RIA Technology

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.

RIA Compliance & Practice Management

Stay up to date on the latest RIA compliance, operations, and technology topics.

Hear from industry experts as they keep you up to date on the latest regulatory developments and practice management topics.

Subscribe to Email Updates

Recent Posts