The Securities and Exchange Commission (SEC) approved the Financial Industry Regulatory Authority’s (FINRA) Rule 5123 on June 7, 2012. The text of the final rule can be found here. The rule is creates some obligations for broker-dealers when they are engaged in selling private placements of securities. Due to a…
Rhode Island has substantially adopted its proposed private fund adviser exemption, which we previously discussed in a posting dated April 10, 2012. The new rule became effective on May 17, 2012. To qualify for the exemption, the adviser must advise only private funds as defined under SEC Rule 203(m)-1. Furthermore,…
The Financial Services Institute (FSI) Chair, Joe Russo, recently released a letter stating that the FSI supports the Financial Industry Regulatory Authority (FINRA) as the new self-regulatory organization (SRO) for investment advisers. Russo stated that the FSI has conducted two polls of its financial adviser members to determine whether they…
As a result of the Dodd-Frank Wall Street Reform and Consumer Protection Act, the Government Accountability Office (GAO), a non-partisan investigative agency of Congress, conducted a study which criticized the Securities and Exchange Commission’s (SEC) oversight of the Financial Industry Regulatory Authority (FINRA). The purpose of the study was to…
Commissioner Luis A. Aguilar of the Securities and Exchange Commission (SEC) spoke at the recent NASAA/SEC Rule 19(d) Conference in Washington D.C. He addressed the importance of cooperation and collaboration between federal and state securities regulatory agencies in order to improve investor protection. Commissioner Aguilar also expressed a desire to…
The Project on Government Oversight (POGO), on May 29, wrote to Rep. Spencer Bachus (R-AL) and Rep. Barney Frank (D-MA) opposing the self-regulatory organization (SRO) bill that was reintroduced in the House of Representatives in April. We discussed the bill in a previous post, SRO Redraft Bill Reintroduced. POGO joins…
The Missouri Securities Commissioner, Robin Carnahan, issued an advisory release to alert entrepreneurs of the impact of the new crowdfunding exemption contained in the recently passed Jumpstart Our Business Startups (JOBS) Act. The exemption will allow entrepreneurs to use crowdfunding over the Internet to raise capital for small businesses. The…
Another large group in the financial service industry has come forward to oppose authorizing the Federal Industry Regulatory Authority (FINRA) to become the self regulatory organization (SRO) for investment advisers. The American Institute of CPAs (AICPA) has voiced its desire to keep the oversight of investment advisers with the Securities…
The Financial Industry Regulatory Authority (FINRA) has proposed a rule which would allow individuals who are not named as parties to a customer-initiated arbitration case to seek expungement relief by initiating “In re” expungement proceedings. Currently, unnamed persons do not have a prescribed way to seek these types of expungements,…
The Financial Industry Regulatory Authority (FINRA) has responded to the Boston Consulting Group (BCG) study that estimated the cost of FINRA becoming the investment adviser self regulatory organization (SRO). The BCG study, which we have discussed in a previous blog, was sponsored by the Financial Planning Coalition, comprised of the…