News - Bates Research

NASAA Seeks to Disrupt Fraud, Moves to Online Exams; FINRA Warns of Pandemic Scams

Bates Research  |  05-21-20

NASAA Seeks to Disrupt Fraud, Moves to Online Exams; FINRA Warns of Pandemic Scams

State and federal regulators are pressing firms to increase vigilance against crisis-related misconduct and other vulnerabilities in order to protect investors. The North American Securities Administrators Association (NASAA) recently took several public steps in response to COVID‑19 challenges, including forming a COVID-19 Enforcement Task Force that will identify and stop the latest potential threats to investors. Meanwhile, FINRA issued alerts detailing the most prevalent scams during the pandemic and the recommended practices for both investors and firms to combat them. Bates Research takes a closer look.

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Bates Practice Leadership Insights: What Compliance Officers are Thinking About Now

Bates News, Bates Research, Compliance and Regulatory Alerts  |  05-20-20

Bates Practice Leadership Insights: What Compliance Officers are Thinking About Now

In this first of a series of conversations with Bates Group practice leaders, we caught up with Robert Lavigne, Managing Director and Bates Compliance Practice Leader, and Hank Sanchez, Esq., Bates Compliance Managing Director and former SEC and FINRA regulator, to get an understanding of what they are hearing from compliance officers right now, as well as advice for compliance teams in the "new normal."

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AML Compliance Report: FinCEN Says Hold the Line, FFIEC Updates Exam Manual

Bates Research  |  05-14-20

AML Compliance Report: FinCEN Says Hold the Line, FFIEC Updates Exam Manual

At a time when regulators are emphasizing their understanding of, and flexibility concerning, the difficulties facing financial firms as a result of COVID-19, FinCEN and the umbrella Federal Financial Institutions Examination Council (FFIEC) are demanding robust compliance with Bank Secrecy Act/ /Anti-Money laundering (BSA/AML) requirements. Since Bates’ last report, in which FinCEN highlighted warnings about bad actors finding opportunities created by the volatility and the fear in the markets, FinCEN issued additional compliance information to its previous alert, and FFIEC published a long- anticipated update to its BSA/AML Examination Manual. Bates Research has the details.

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FINRA Carries On: Focuses on High-Risk Brokers, Broker Beneficiaries, Arb Postponement & Reg BI

Bates Research  |  04-30-20

FINRA Carries On: Focuses on High-Risk Brokers, Broker Beneficiaries, Arb Postponement & Reg BI

While the COVID-19 pandemic continues to create unusual and difficult challenges for the financial service industry, FINRA continues to move forward with regulatory matters that warrant attention. In this article, Bates reviews recent FINRA developments on high-risk brokers, proposed limitations on brokers acting as beneficiaries, executors or trustees for senior investors, additional COVID-19-related hearing postponements, a recent arbitration proposal related to claims against inactive members and further remarks on Regulation Best Interest (Reg BI).

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Coronavirus and the Approaching Business Interruption Insurance Storm

Bates Research  |  04-21-20

Coronavirus and the Approaching Business Interruption Insurance Storm

These are uncertain times for insurers. In a report issued on March 31, 2020, Congressional Research Service (“CRS”) staff noted the likelihood that “loss of income from mandatory or voluntary closures, supply chain disruptions, and reduced demand due to social distancing measures may induce businesses of all sizes to seek compensation from insurers.”

That was clearly an understatement. Now, market participants are sounding alarms about a wave of state and federal legislation that would shift onto insurers a significant portion of the burden to compensate businesses from the massive losses resulting from pandemic-related shutdowns. Bates takes a look at these legislative moves, early legal action taken by policyholders seeking coverage for business interruption losses as a consequence of the coronavirus (COVID-19), and the reaction by the insurance industry.  

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Reg BI: SEC Keeps June 30th Deadline, FINRA Seeks to Amend Suitability Rule

Bates Research  |  04-03-20

Reg BI: SEC Keeps June 30th Deadline, FINRA Seeks to Amend Suitability Rule

Over the past few weeks the coronavirus pandemic has overtaken the nation’s financial agenda and diverted the attention of financial regulators who are struggling to keep up and address urgent market needs. These actions have left some firms curious as to whether the rollout of Regulation Best Interest (“Reg BI”) may be delayed. Well, the wait is over, and SEC Chair Clayton has weighed in. Meanwhile, FINRA has pushed forward amendments to its rules on suitability and non-cash compensation, and the SEC has filed a brief in the Second Circuit Court of Appeals arguing for rejection of state petitions for review of the Reg BI final rule. There is so much happening and many moving parts. Here’s what you need to know.

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Enforcement Warnings in the Age of the Coronavirus

Bates Research  |  03-26-20

Enforcement Warnings in the Age of the Coronavirus

As regulators struggle to adjust to the stress that the coronavirus pandemic is placing on the markets, fraudsters are viewing it as an opportunity. Bates Research takes a look at the latest enforcement warnings and guidance from financial regulators, who are sounding alarms over the added threats that exist in the current volatile environment.

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Financial Regulatory Guidance, Assistance and Relief Roundup

Bates Research  |  03-19-20

Financial Regulatory Guidance, Assistance and Relief Roundup

During the current crisis, the challenge for financial firms and investors is to keep on top of the latest communications from regulators, understand what is actionable and what is not, and ensure that compliance and supervision processes are in place to manage the crisis. Here’s a recap of the latest compliance guidance, regulatory assistance and relief offered by the SEC, FINRA, NFA and MSRB.

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Regulators Are Gaining Traction in the Fight Against Elder Financial Exploitation

Bates Research  |  03-12-20

Regulators Are Gaining Traction in the Fight Against Elder Financial Exploitation

Bates Group has been tracking regulatory and enforcement developments on senior financial exploitation. Two recent publications and recent sweeping enforcement actions suggest that the phenomenon is becoming better understood and addressed. FinCEN published a strategic analysis after reviewing SARs filings over a six-year period, and NASAA has issued a statement and legislative update based, in part, on an enforcement analysis showing that the Model Act to Protect Vulnerable Adults is gaining traction. The Department of Justice, FBI and Postal Inspector jointly announced the results of “the largest coordinated sweep of elder fraud cases in history.” Bates Research takes a closer look.

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Facing the Coronavirus: Financial Industry Preparations, Reassurances and Contingencies

Bates News, Bates Research, Compliance and Regulatory Alerts  |  03-05-20

Facing the Coronavirus: Financial Industry Preparations, Reassurances and Contingencies

If you’ve been in meetings about investor communications, business travel, or other contingency planning over the past few days and weeks, you are not alone. Since the outbreak of the coronavirus (also referred to as COVID-19) and more recently, the precipitous volatility of the financial markets, financial firms have been deluged with questions from just about every stakeholder group about how to respond. Regulators are weighing in as well. Bates looks at some of the efforts to prepare and reassure everyone out there.

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