SEC Announces Examination Priorities for 2014
On January 9, the SEC announced its examination priorities for 2014, which cover a wide range of issues at financial institutions, including investment advisers and investment companies, broker-dealers, clearing agencies, exchanges and other self-regulatory organizations, hedge funds, private equity funds and transfer agents.
The market-wide priorities include fraud detection and prevention, corporate governance and enterprise risk management, technology controls, issues posed by the convergence of broker-dealer and investment adviser businesses and by new rules and regulations, and retirement investments and rollovers. Program Priorities.
SEC Issues Interpretive Guidance on New Municipal Advisors Registration Rule
On January 10, the SEC announced that its Office of Municipal Securities has issued interpretive guidance to address questions from market participants regarding the implementation of new final SEC rules requiring municipal advisors to register with the SEC.
State and local governments frequently use paid advisors to help them decide how and when to issue municipal securities and how to invest proceeds from the sales. The 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act required these advisors to register with the SEC like other market intermediaries. The SEC's final rule was adopted in September 2013 and becomes effective on January 13, 2014. Among the issues addressed in the guidance are: (i) the advice standard, including the general information exclusion and the treatment of business promotional materials used by underwriters; (ii) the exemption for independent municipal advisors; (iii) the exclusion for registered investment advisers; (iv) the underwriter exclusion, including engagements as underwriters; and (v) the effective date of the final rules and the compliance period for using the final registration forms. Interpretative Guidance.