Lax standards among financial advisers who manage 401(k)s and IRAs are in the crosshairs of the White House, which has proposed rules that require advisors to either use independent computer models that spit out advice, or else avoid steering workers into funds to which they are tied or that pay them a fee based on their recommendation. ...
In her remarks before the Consumer Federation of America Thursday, SEC Chairman Mary Schapiro reiterated her commitment to creating a “strong fiduciary standard” for all securities professionals. She also called for clear point-of-sale disclosures, a re-assessment of 12b-1 fees, a closer look at target date funds and self-funding for the agency. ...
Congress is considering legislation that would require broker/dealer reps to adhere to the fiduciary standard. That could mean major changes in all areas of operation for firms and advisors...
The SEC yesterday charged Nashville-based broker/dealer Morgan Keegan for misleading thousands of investors about the risks of auction rate securities (ARS). Further, the SEC alleges that the firm pushed illiquid auction rate securities on thousands of clients long after it knew the market had frozen. The firm announced it had received a Wells Notice from the SEC last week....
A new rule that took effect in January stipulates that there are three reasons—and three reasons only—to grant expungement of client complaints from your U4...
The securities industry is fighting tooth and nail to save 12b-1 fees. Exactly one month after the June 19 SEC roundtable convened to discuss the fate of 12b-1 fees, the securities industry’s lobby group, the Securities Industry and Financial Markets Association (SIFMA), released its comment letter today. The letter says that 12b-1 fees are a necessary part of doing business, and that abolishing them will harm investors and stunt industry competition....
In his new role as New York governor, Eliot Spitzer is joining forces with those he used to terrorize—Wall Street chief executives—to modernize financial services regulation in the state, the Financial Times reports. Spitzer is forming a panel with the executives, as well as with lawyers, consumer groups and regulators to streamline regulations and make New York more competitive with London, without sacrificing investor protection. The committee will be chaired by Eric Dinallo, the New York insurance superintendent, and will seek to simplify regulation of insurance companies state-chartered banks and securities dealers. ...
The SEC isn’t going to fight the March 30 D.C. Court of Appeals ruling that vacated Rule 202, the broker/dealer exemption (a.k.a. the Merrill Lynch rule)—they’re just asking for a little mercy for firms that have to adjust. The securities industry still hopes that the SEC will somehow come up with a new plan to keep the fee-based brokerage account (or something like it) from coverage by the Investment Advisers Act of 1940, which mandates that to offer financial advice, you have to be a fiduciary....
WASHINGTON, D.C. – Speaking at the 49th annual Investment Company Institute general membership meeting, NASD Chairman Mary Shapiro told mutual fund executives she sees better regulation of investment products as a result of the expected merger of the NYSE and NASD regulatory bodies. While this potentially is better news for investors, purveyors of mutual funds may find themselves in the crosshairs when bringing more nuanced products to market....
Add A.G. Edwards to the long list of firms that have been fined by the SEC for long-ago failures to supervise brokers who deceptively market timed mutual funds. ...
Q: I always live by the rule of The Client Comes First. But, sometimes I feel that my bosses are pushing in the opposite direction. What do I do when I feel a product or solution that is not proprietary is a better fit for my client, but my bosses are pushing me to sell our company products for the benefit of the company?...
Registered investment advisors, broker-dealers and hedge funds are spending more money on compliance software than ever before. This according to a report released on Tuesday by research firm Celent, which predicts that the U.S. wealth management compliance solutions market will reap $178 million in sales in 2007, growing to $318 million by 2011. The overall market is expected to grow steadily at a 15 percent compound annual growth rate, but the kinds of purchases made and the amount spent by different firms will vary by market segment. ...
If you’re like most registered reps these days, you’ve got some portion of your clients in a fee-based compensation arrangement. And, no doubt, you’ve been selling yourself as a full-service, top-to-bottom “financial advisor,” financial consultant, wealth manager or some other such glorified title. (Does anyone’s card read stockbroker anymore?)...
Fairly or unfairly, gambling and strip clubs have always been associated with slick, fast-talking Wall Street brokers. And while most financial advisors would argue that this is nothing more than an unfortunate stereotype, the headlines continue to suggest otherwise....
If you are like most working people, you go to the office every day. And, if you like your job, it can even be hard to stay away. But if you get a suspension...
A colleague of mine recently left our firm and the business, asking me to take care of a few of his clients. One client about whom he was concerned happens to be his cousin. My colleague was new to the business, and his manager handled setting up the cousin's retirement plan. ...
Less than 10 years after they settled the infamous boom-boom room case, Smith Barney is being sued for discrimination again. The new case, Fassbender...
The American Dream Planner is designed to develop and stress- test wealth accumulation, management and transfer choices. The software accepts unlimited investments, tax deferred accounts, real property and business interests, income and expenses. Plans can include Trusts (Bypass, Marital, ILITs, CRTs, GRATs), SCINs, marketability and minority interest discounts and other techniques with income, gift and estate tax calculations. Data rich and interactive pie, line and bar charts and tabular data and mail merge provide a source for customizable reports. All versions can share encrypted data. The Personal Edition is intended for individuals with current estates of less than $3-5M. ...
