Structured Thoughts: News for the financial services community - Volume 1, Issue 16 - November 23, 2010



Proposed ERISA Regulation Would Expand Persons Considered Fiduciaries… page 1; Disclosure Statement for Retail Investors…page 2; and, Know Your Customer and Suitability Update… page 3

Proposed ERISA Regulation Would Expand Persons Considered


As discussed in our client alert dated November 5, 2010, on October 21, 2010, the Department of Labor issued a proposed regulation1 that could significantly expand the categories of persons considered fiduciaries as a result of their providing investment advice to plans subject to ERISA or to participants or beneficiaries of such plans. This proposed regulation was issued under the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), which subjects fiduciaries to standards of prudence and loyalty to the plans for which they are fiduciaries, as well as to conflict of interest rules, referred to as the “prohibited transaction rules”....

Disclosure Statement for Retail Investors

Title IX of the Dodd-Frank Act set forth a number of measures intended to improve investor protection. Section 913 of the Act directs the SEC to “facilitate the provision of simple and clear disclosures to investors regarding the terms of their relationships with brokers, dealers and investment advisers, including any material conflicts of interest.” In October 2010, FINRA separately published Regulatory Notice 10-54 in which it requests comment on a new concept proposal to require FINRA member firms to provide retail customers with a written disclosure statement at the commencement of the relationship. Comments are requested by December 27, 2010....

Know Your Customer and Suitability Update

We reported in a prior issue of Structured Thoughts on FINRA’s amendments to proposed changes to the know your customer rule (Rule 2090) and the suitability rule (Rule 2111)....

Please see full newsletter below for more information.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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