Compliance with the Securities and Trade Fee’s advertising rule has been named advisors’ high chore for the third yr in a row.
That’s in keeping with the newest Funding Administration Compliance Testing Survey, carried out by the Funding Adviser Affiliation, ACA Compliance and Yuter Compliance Consulting.
Promoting/advertising was recognized by 70% of survey respondents because the “hottest” compliance subject. Respondents had been requested to select three.
The SEC warned in early June that examiners are beefing up scrutiny of advisors’ compliance with its new advertising rule by zeroing in on testimonials and endorsements, third-party rankings and Type ADV.
The securities regulator’s examination division warned that whereas it is going to proceed to concentrate on insurance policies and procedures, substantiation, efficiency promoting and books and information, examination employees is now “rising its focus” on different advertising rule-related areas.
Compliance professionals at 581 funding advisor corporations participated within the survey. All agency sizes had been represented, with 26% of respondents managing lower than $1 billion in property, 41% managing $1 billion to $10 billion, and 34% managing greater than $10 billion.
In keeping with the report, cybersecurity was the second hottest subject, named by 52% of compliance officers, and digital communications surveillance climbed to 3rd, named by 35% of respondents.
Final week, a brand new potential compliance headache emerged.
Aaron Pinnick, supervisor of Thought Management at ACA Group, advised ThinkAdvisor Thursday in an electronic mail that Meta’s new Threads platform ”is yet one more communications channel that corporations might want to monitor and handle, and like all new types of communications, corporations might want to stability the potential alternatives of this new platform with the compliance prices related to monitoring its use.”
Because the survey notes, digital communications is “a sizzling subject for compliance professionals, and an space of curiosity for the SEC so corporations might want to assume by way of if/how they are going to allow their staff to make use of this new communications methodology,” Pinnick continued.
Additionally price noting, Pinnick stated, is that “42% of corporations solely allow the usage of enterprise electronic mail and enterprise telephone for enterprise communications (the most typical method in keeping with our survey) with only a few corporations permitting people to make use of different social media websites (e.g., Fb, LinkedIn) for enterprise functions. So, I’d guess that the majority corporations will formally ban their staff from utilizing Threads for enterprise functions.”
Learn the gallery for the opposite high compliance challenges for advisors this yr, in keeping with the survey.
