News & Events

Each year, the SEC and FINRA release Exam and Risk Monitoring Reports highlighting continuing and emerging concerns for the year. These agency communications serve as a potential notice of subjects scrutinized for future examinations. In this guide, Bates walks you through the exam process and break down what you need to know, including: anticipation and preparation, first contact, document production, interviews, and findings.

In a new Risk Alert issued by the Division of Examinations, the SEC reminded investment advisers to review their written policies and procedures on the new marketing rule before the November 4, 2022 compliance deadline. 

NASAA is reminding financial professionals that state regulators remain a force to be reckoned with in an increasingly complex financial marketplace. Describing a need to protect elderly investors from unsuitable products, a need to protect average investors from the risks of confusing contract terms and misleading marketing communications, and to address ongoing and persistent complaints of fraud, NASAA proposed revisions to its Guidelines on REITs. Bates looks at the four proposed revisions and what they could mean for your firm and clients.

As the size of the private funds market has grown, regulators have been increasingly concerned about the risk posed to investors. The sheer size of the market—and the state of the current disclosure framework covering it—has motivated regulators from both the SEC and CFTC to propose additional rule amendments to increase the regulatory oversight of private fund advisers and the funds they advise. Bates takes a look at key features of the SEC/CFTC proposal.

Bates Group welcomes our newest consulting and testifying experts (pictured, L-R):

Erin Baskett, CPA, CGMA - Brokerage, Investment Advisory, Cryptocurrency Consulting

Patrick Cox - Fintech and Cybersecurity, Employment Matters, Broker-Dealer Sales Practice

Frederick Egler - Operational Risk Management, Insurance/Reinsurance, Banking

Brian Warshaw - Broker-Dealer Operations, Introducing Firm Operations, Transaction Processing

Summer is coming to a quick close, and we hope you had a chance to get moving and enjoy some fun in the sun!

While you are celebrating the final days of summer, we’ve compiled our annual summer roundup of news that you may have missed, as well as a sneak peek of live and virtual events happening this fall. We’ve even included a bonus track at the end of our list to cap off your summer.

Continuing to grow and expand its national reach, Bates Group welcomes Paul Lambert as a Strategic Advisor and Consulting Expert. A 30-year financial services veteran at Bank of America Merrill Lynch, Paul will be working with senior leadership to expand our client engagement across the business. Read the full announcement to learn more about Paul and the experience he brings to the Bates team.

FINRA remained active this summer with a series of important proposed rule changes and risk-related compliance reminders. Here’s a summary to keep you up to date.

Responding to the growing popularity of Bitcoin and other cryptocurrencies, in 2015 the New York Superintendent of Financial Services came up with the idea for a new charter called BitLicense, based on the historic template for bank and trust charters. In this article, Bates expert Paul Nelson takes a look at the past, present, and future of the BitLicense program, in the larger context of today's crypto market.

The Bates main office has recently relocated from Lake Oswego to Portland.

Did Shakespeare get it right? Is past really prologue when it comes to your mutual fund share class selection, conflicts, and disclosures?  Find out how Bates can help you put the past in the past.  

On August 3, 2022, SEC staff issued new guidance addressing conflicts of interest under the Regulation Best Interest (“Reg BI”) standard for broker-dealers and the fiduciary standard for investment advisers. While the staff bulletin states clearly that the guidance is intended only to be a reflection of internal views on the subject, its tone, comprehensiveness (replete with numerous examples), and even its pragmatic question-and-answer format warrant careful attention. Read our full analysis for details on this new guidance and how it could impact your firm or clients.

Bates Managing Director Julie Johnstone was quoted in a recent InvestmentNews Article on the increase of Reg BI Customer Cases in FINRA Arbitration.

Bates Managing Director Brandi Reynolds (CAMS-Audit) is quoted in a new ACAMS Insights article discussing efforts to develop a federal regulatory framework for crypto and virtual assets.

The mandatory compliance deadline for the SEC marketing rule—which replaced the former Advertising Rule and the Cash Solicitation Rule—is November 4, 2022. Advisers should be reviewing, revising, and preparing to implement procedures and policies to prevent potential violations. There’s still time, but there’s also a lot to consider, as the rule consolidates previous SEC guidance, no-action letters and exam findings on questions concerning recommendations, testimonials, and the presentation of performance metrics. Here’s what you need to know.

FINRA has filed with the SEC proposed changes to FINRA Rule 3110 to add new Supplementary Material 3110.19 (Residential Supervisory Location). The changes allow a home office to be considered a non-branch “residential supervisory location” under certain conditions. By this proposal, FINRA is adapting to a new, post-pandemic model in which employees work at both conventional offices and in their private residences—a model which FINRA acknowledges is likely to “endure.” Read the full article for details on these proposed rule changes.