Friday, November 22, 2013

California mandates dedicated email

On November 22, 2013, the California Department of Business Oversight ("DBO") issued an order to all advisors registered in California requiring a dedicated email address for communications with the Advisor.

By January 4, 2014, all advisory firms registered with the State of California must comply.

Here are the details

  • Email must be dedicated to compliance matters and cannot be used publicly. It can be an address of your choosing.
  • Email must be monitored daily. While we don't expect that they will communicate with you daily, they want to ensure timeline receipt and follow-up.
  • Account must be established to allow attachments.
  • Spam settings must be modified to allow emails from the state's domains ("@dbo.ca.gov" or "@service.govdelivery.com")

After configuring the account, you must complete an online form with the state at https://dbolicensee.secureprtportal.com. The DBO has mailed or email you a username and password.

The full text of the Order is available on the DBO website at http://dbo.ca.gov/Laws_&_Regs/2013_DBO_Communications_Order.pdf.

Please contact us if you have any questions or issues.

Thank you.

The AdvisorAssist Team

Tuesday, November 19, 2013

REMINDER: 2014 Annual Registration Fees

REMINDER:

If you have not paid your 2014 registration or notice filing fees, keep reading!


The registration of and its advisory persons expire on December 31st each year. To maintain the registration of and your Investment Advisor Representative(s), you must pay the required fee by December 13, 2013.

You may have received an email from FINRA that the FINRA-managed systems were updated this past weekend with the 2014 Preliminary Renewal Statements. For ongoing compliance clients, AdvisorAssist has also reviewed your account and provided instructions for next steps.

As always, we are here to answer any questions that may arise. Please call us at (617) 800-0388 or email us at Support@AdvisorAssist.com if you have any questions.

Best regards,

AdvisorAssist Team
AdvisorAssist RIA Compliance Services
www.AdvisorAssist.com
Support@AdvisorAssist.com
Advisor Support - 617.800.0388, Option 2

Massachusetts lists deficiencies in "Switch Adviser" exams

In the wake of Dodd-Frank, the Massachusetts Securities Division added approximately 140 advisors that did not meet the asset requirements of the new SEC regulations.

The MA Securities Division has visited approximately half of these advisors through October 2013 and plans to visit all of them soon. Of the ~140 advisors, ~100 have a principal place of business in Massachusetts, so they have conducted exams of ~50 of these firms.

The MA Securities Division has noted numerous deficiencies from books and records to disclosures and of course custody. As the Maddoff fraud unveiled weaknesses in regulatory reviews, the MA Securities Division pointed out that only 1 of 102 advisors had a previous custody exam by the SEC. Below is a list of these deficiencies.

Some details on these deficiencies (while not noted in the report), include:

  • ADV disclosures not properly reflecting state requirements.

  • ADV not accurately reflecting custody requirements for advisors that deduct fees. In addition to the SEC safeguards, a most state advisors are subject to additional rules to avoid custody. An advisor must provide the client with an invoice (or similar report) that provides the calculation methodology used to derive the advisors fee. This must be sent out promptly after deducting any fees from the client's account(s) and include: (i) the period covered; (ii) the market value used in the calculation; (iii) the rate (annual/quarterly or monthly); and (iv) the amount deducted.

  • Client agreements that do not meet state requirements and do not reflect custody clauses (as noted above).
  • Custody. Many advisors had not updated practices and disclosures for new custody rules.

  • Conflicts of Interest. ADV and related disclosures not adequately reflecting all conflicts.

  • Books and Records. The largest volume of deficiencies. While MA follows the SEC rules (Rule 204-2 of the Advisers Act), advisors are still struggling with books and records.
  • Financials. Yes they care about your internal books and records and financial health!

There are many other deficiencies noted. A compilation of deficiencies from numerous states was published by NASAA >> http://www.nasaa.org/wp-content/uploads/2013/10/IA-Sweep-2013-Final.pdf

Here is a link to the state report >>> www.sec.state.ma.us/sct/sctpdf/switch-report.pdf

Monday, November 11, 2013

FINRA - Preliminary Renewal Statements (2014)

Dear Advisor:

The registration of and its advisory persons expire on December 31st each year. To maintain the registration of and your Investment Advisor Representative(s), you must pay the required fee by December 13, 2013.

You may have received an email from FINRA that the FINRA-managed systems were updated this past weekend with the 2014 Preliminary Renewal Statements. AdvisorAssist is reviewing these statements this week and will send you instructions for funding this week.

As always, we are here to answer any questions that may arise. Please call us at (617) 800-0388 or email us at Support@AdvisorAssist.com if you have any questions.

Best regards,

AdvisorAssist Team
AdvisorAssist RIA Compliance Services
www.AdvisorAssist.com
Support@AdvisorAssist.com
Advisor Support - 617.800.0388, Option 2

Monday, November 4, 2013

FINRA Bank Change

FINRA is changing the way they handle payments made to their bank and E-Bill system. Please see the FINRA notice below.


In February 2014, FINRA will switch its banking services to a new bank. As part of this transition, FINRA will simplify the methods firms use to make payments to us. Since many firms will need to make changes to their accounting processes, we want to provide an overview of these changes.

First, FINRA will consolidate all check payment addresses, with the exception of GASB payments, into a single payment address. This change will allow for a more efficient check payment and deposit process. You will receive the new address for check payments, wiring instructions and W-9 information in future communications.

Second, to ensure your firm's payments are applied to the correct invoice in a timely manner, firms must include invoice numbers on all check remittances, and include it as the reference number on ACH and wire payments. Note: If a firm submits a payment without an invoice number, FINRA will apply the funds to the firm's FINRA Flex-Funding account, which is accessible via E-Bill. Someone at your firm must then transfer the funds to the appropriate invoice in order for the invoice to be closed.

As a reminder, firms can view and pay invoices through E-Bill, FINRA's electronic billing system.


If you have any questions, please contact us by completing a support request or emailing us at support@advisorassist.com.

Thank you,
The AdvisorAssist Team

Friday, November 1, 2013

2013 NASAA Enforcement Report has been issued

The 2013 NASAA Enforcement Report has been released to the public.

The report summarized the investigations, enforcement statistics, and investor relief from the 2012 review activities.. The most notable is the focus on Regulation D filings, including private deals, real estate, oil & gas and others. Unregistered securities and side deals are among the top issues.

Here's a link to the full report >>> http://www.nasaa.org/wp-content/uploads/2013/10/2013-Enforcement-Report-on-2012-data.pdf#!.