RIA Compliance and Practice Management Blog

Top RIA Compliance News Articles for the Week of June 17th, 2022

Posted by RIA in a Box

Jun 24, 2022 12:59:47 PM

This week's recap focuses on the Securities and Exchange Commission's ("SEC") examination priorities, cryptocurrency, and a recent SEC bulletin emphasizing serving clients' best interest.

Each week, 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 RIA in a Box's new Continuing Education Program, an outlook of the RIA industry, succession planning for investment advisers, and key considerations for joining or starting an RIA firm. 


Here are our top investment adviser compliance articles for
the week of June 17th, 2022:

Learn More About Our IAR Contuining Education Program

    1. RIA in a Box Offers CE Program to Meet NASAA Model Rule Mandates (Author – Patrick Donachie, Wealth Management)

This week, RIA in a Box announced its continuing education program to support IARs in meeting the requirements set by NASAA's model rule. The model rule, currently adopted by eight states and the District of Columbia, requires IARs to complete 12 CE hours per reporting period. 

The new program is integrated with RIA in a Box's leading MyRIACompliance® platform, simplifying the process for advisers to complete their compliance requirements in one place. The coursework includes instructional videos and quizzes that cover various topics, such as the SEC's marketing rule, regulatory audits, ESG and cryptocurrencies. 

    2. IAA snapshot portrays a thriving RIA sector (Author – Mark Schoeff Jr., Investment News)

Mark Schoeff Jr. highlights findings from the Investment Advisor Industry Snapshot 2022. The study, produced by the Investment Adviser Association ("IAA") and National Regulatory Services ("NRS"), shows strong growth for the RIA industry in 2021. A key takeaway of the study demonstrating this growth is the 6.7% increase in SEC registered firms from 2020 to 2021.

The study also confirms that most of the investment adviser sector is comprised of small businesses, with 88% of firms employing 50 or fewer people. NRS President, John Gebauer discusses the diverse nature of the industry and how it impacts the SEC's focus areas for regulation, such as increased protections for private investors. 

    3. RIA Industry Broke Records, Again, in 2021: New Data (Jeff Berman – Think Advisor)

The results from the Investment Advisor Industry Snapshot 2022 demonstrate record growth for the RIA industry in terms of assets under management ("AUM"), the number of investment advisers registered with the SEC, and the number of clients served. The study shows AUM grew by 16.7% in 2021, and the highest growth in advisor firms occurred in southern states, particularly Florida. In the past eight years, the number of SEC-registered firms have significantly increased and the number of brokerage firms have declined. 

    4. Succession plan services gain traction as a tool for recruiting, making acquisitions (Author – Jeff Benjamin, Investment News)

In this article, Jeff Benjamin explores how investment advisers go about succession planning. Independent advisers have more control over how to build their practices and the legacy they leave for their clients and community. Different succession plans include growth through acquisition or finding a successor to run the firm. Research indicates advisers place high value on personality when evaluating potential successors or an acquirer for their firm. It's important to advisers to ensure continuity of the clients' best interests along with keeping the firm compliant.

    5. Take Care Before Founding, Joining RIAs (Author – Karen Demasters, Financial Advisor)

This article covers the precautionary steps advisers should take before making a change to the independent RIA model. It is recommended advisers hire a lawyer and consultant to mitigate risks, such as violating written policies and procedures. Next, advisers should appoint a chief compliance officer and register the firm with the appropriate state organization or the SEC.

The article also addresses how a consultant can assist with important business elements including a business continuity plan, cybersecurity plans, and a compliance manual. While the independence of an RIA in sought after, advisers must fully understand the complex details and steps that go into joining or starting a firm. 

Learn More About RolloverAnalyzer

Don't forget to check out last week's top RIA compliance news articles that focus on the SEC's proposed rules for environmental, social, and governance ("ESG") disclosures, compliance deficiencies with the Department of Labor's ("DOL") PTE 2020-02, and the role "information providers" may play in giving investors investment advice.

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.

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