Ever since the SEC and other regulatory bodies (i.e., FINRA) identified the possibility of “significant business disruptions” many years ago and mandated that registrants create, maintain, and test a Business Continuity Plan (“BCP”), these plans have rarely been taken very seriously until they are needed.
We are excited to announce the newest addition to the Joot team: John Ramirez! According to Bo Howell, CEO of Joot, the firm has been growing steadily and it is focused on building the right team to deliver both innovative technology and exceptional services.
As many of you know, on June 5, 2019, the SEC passed Regulation Best Interest (Regulation BI) and related rules and interpretations that were intended to enhance investor protection and clarify the difference between broker-dealers (BDs) and registered investment advisers (RIAs). The rule and two final interpretations were over 1,300 pages long, ugh. When I think about reading that many pages of bureaucracy inspired legalese, I think of my former colleague Rich Rudman saying that when it comes to legal writing (actually, I think he applied it to almost everything): Be Bold, Be Brief, Be God. With that in mind, we’re going to summarize the whole thing in one article that is less than 2,000 words. Here we go!
IM Director's Recent Remarks on Standards of Conduct & Liquidity Risk Management
by Peter Michael Allen
The SEC has finally proposed a rule that will help clarify the distinction between brokers that refer to themselves as "financial advisors" and investment advisers. (We won't get into why it took so long or how this is a response to the Department of Labor's fiduciary rule, which was recently vacated by federal courts.) Most investors are unaware of the difference and the legal standards that apply to both. In the case of brokers, they are not fiduciaries, which means they do not have to act in the best interest of customers. Investment advisers, however, are fiduciaries and must always act in the best interest of clients. This may seem like a subtle distinction, but it's hugely important for investors that are not well-versed in the working of our securities markets.