Call Now For a Free Consultation:
(614) 532-4576
Nationwide Representation

SEC Makes Recommendations on How to Improve Advisor Oversight

A stronger, better regulatory system for financial advisors was one of the items for improvement listed in the 2010 Dodd-Frank financial reform law. The law instructed the SEC to study the situation and to provide Congress with recommendations for improvement. As reported in a Jan. 23InvestmentNews article, the SEC delivered the requested report late last Wednesday (“SEC offers 3 options for RIA oversight”).

According to the article, the SEC offered three options for improved regulations:

#1. Congress could authorize the SEC to impose fees on advisors that would be used to fund the SEC’s examination and enforcement efforts. The new law requires the SEC to begin monitoring advisers to hedge funds and private-equity funds - a task that the SEC cannot do effectively with its current resources. The Commission says an increase in fees could help fill the funding holes.

#2. Congress could allow the SEC to designate one or more of the self-regulatory organizations to oversee advisors. The SEC study makes it clear that a lack of funding is a serious threat to the SEC’s ability to effectively examine all investment advisors. If Congress prefers not to authorize the imposition of fees on advisors, the establishment of a separate agency to take on the responsibility of conducting the examinations may be a good option.

#3. Congress could grant FINRA the power to expand its oversight to include registered investment advisors of dually registered firms (those who have both advisors and broker-dealers). While this option is rife with controversy, it also has many vocal supporters.

None of the recommendations is without its industry critics, and debate over which course of action is the best will likely continue for some time.

The information contained in The Firm’s posts on its blog, fraud alerts, investigations or elsewhere on the site is based upon information obtained from other sources including, but not limited to, news outlets and federal, state, and regulatory agency filings. All suspects and subjects of postings herein are presumed innocent until proven guilty in a court of law or administrative action and any and all crimes are alleged until a court or regulatory agency finds otherwise .

Share This Story
If you found the information provided by this article useful, consider sharing to your social media channels to help others in their search for reliable resources.
Consult with Our Legal Team
There is never a cost associated with a consultation
Atlanta Office

945 East Paces Ferry Road, Suite 2275
Atlanta, GA 30326
Columbus Office

305 W. Nationwide Blvd
Columbus, OH 43215
Meyer Wilson
New Orleans Office

900 Camp Street 
Suite 337
New Orleans, LA 70130
Los Angeles Office

2029 Century Park East,
Suite 400N
Los Angeles, CA 90067
Cleveland Office

4781 Richmond Rd.
Suite 400
Warrensville Heights, OH 44128
Bloomfield Hills Office

41000 Woodward Ave.,
Suite 350
Bloomfield Hills, MI 48304
Quick Links
The information contained in this Website is provided for informational purposes only, and should not be construed as legal advice on any subject matter. No recipients of content from this site, clients or otherwise, should act or refrain from acting on the basis of any content included in the site without seeking the appropriate legal or other professional advice on the particular facts and circumstances at issue from an attorney licensed in the recipient's state. Read More
The information contained in this Website is provided for informational purposes only, and should not be construed as legal advice on any subject matter.
Read More
chevron-down linkedin facebook pinterest youtube rss twitter instagram facebook-blank rss-blank linkedin-blank pinterest youtube twitter instagram