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Federal Law Enforcement Targets 2300 Money Mules Fueling Fraud in All 50 States
Image © [Jess-Ivanova] /Adobe Stock

12-17-20

Federal Law Enforcement Targets 2300 Money Mules Fueling Fraud in All 50 States

On December 2, 2020, federal law enforcement cracked down on money mules again in a joint operation involving nine federal law enforcement agencies to “disrupt the networks through which transnational fraudsters move the proceeds of their crimes.” Bates reviews the highlights and takeaways from the recent announcement by the DOJ and partner agencies. Read the full article to learn about this nationwide initiative and the variety of scams utilizing money mules targeting your financial firm, customers, and elder clients in particular.

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Multi-Branch Office Supervision and Compliance – OCIE Details Deficiencies
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12-11-20

Multi-Branch Office Supervision and Compliance – OCIE Details Deficiencies

Last month, OCIE released a Risk Alert urging SEC-registered investment advisers to consider the “unique risks and challenges presented by “employing a business model that includes numerous branch offices and business operations that are geographically dispersed.” Although COVID-19 was not the basis for the alert, the pandemic undeniably added urgency to issues around remote supervision and compliance, pushing the topic higher on the list of areas OCIE is continuing to monitor. Bates takes a closer look at OCIE’s findings and warnings to firms overseeing multi-branch office compliance.

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Noting Deficiencies, OCIE Warns IAs to Comply with the Compliance Rule; Director Driscoll Emphasizes CCO Empowerment

12-03-20

Noting Deficiencies, OCIE Warns IAs to Comply with the Compliance Rule; Director Driscoll Emphasizes CCO Empowerment

On November 19, 2020, OCIE issued an alert on common deficiencies identified in recent examinations related to the obligations on investment advisers required by the Advisers Act (“Compliance Rule”). In this article, Bates takes a closer look at OCIE’s recent findings and the additional emphasis placed upon the role of CCOs by OCIE Director Peter Driscoll (pictured) in a related address.

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FINRA is Reviewing Firms’ Systems and Procedures for Providing Customer Waivers/Rebates through Rights of Reinstatement (RoR) on Mutual Fund Purchases

12-01-20

FINRA is Reviewing Firms’ Systems and Procedures for Providing Customer Waivers/Rebates through Rights of Reinstatement (RoR) on Mutual Fund Purchases

FINRA is conducting a targeted review of brokerage firms' systems and procedures for providing customers waivers and rebates available through Rights of Reinstatement (RoR) on mutual fund purchases. As part of this review, FINRA will request each firm that receives this information request respond to certain questions with respect to the period of January 1, 2017 through June 30, 2020.

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IAA 2020 Compliance Workshops December 2-3, 2020 - Sponsored by Bates Compliance

11-30-20

IAA 2020 Compliance Workshops December 2-3, 2020 - Sponsored by Bates Compliance

The Investment Adviser Association (IAA) will be holding their 2020 Compliance Workshops on Wednesday and Thursday, December 2-3, 2020. This virtual event features breakouts with speakers from nine SEC regional offices across the country sharing current examination priorities for investment advisers, in addition to general sessions covering other important matters for the advisory community, such as managing conflicts of interest. Bates Compliance Managing Director Linda Shirkey will be speaking on the Day 2 General Session "Fiduciary Obligations for Identifying, Managing, and Disclosing Conflicts of Interest."

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SEC Allows Remote Inspections Through 2021

11-23-20

SEC Allows Remote Inspections Through 2021

On November 18, 2020, the SEC made effective FINRA’s proposed temporary rule amendment allowing remote inspections through December 31, 2021. The SEC regulatory action adopts temporary relief (Supplementary Material .17) under FINRA Rule 3110 (Supervision) by providing member firms the option to remotely complete inspection obligations for Calendar Years 2020 and 2021. FINRA stated that the change was a response to the operational challenges presented by the COVID-19 pandemic.

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Tracking FinCEN Moves: Regulator Issues a Flurry of Advisories on Ransomware, Unemployment, Human Trafficking, Rule Amendments and More
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11-20-20

Tracking FinCEN Moves: Regulator Issues a Flurry of Advisories on Ransomware, Unemployment, Human Trafficking, Rule Amendments and More

The Financial Crimes Enforcement Network (FinCEN) continues its fast pace, issuing important new advisories, statements and rulemakings. Since September, FinCEN has issued advisories on ransomware, unemployment insurance fraud, and the money laundering aspects of human trafficking, an Order targeting certain residential real estate transactions based on geography, and has proposed specific amendments that affect recordkeeping and travel, as well as broad recommendations affecting Bank Secrecy Act regulations that make up the current anti-money laundering framework. Bates takes a look at the details you need to know.

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SEC and FINRA Offer Observations to Improve Compliance with Reg BI and Form CRS
Images © [Kristina Blokhin, Andriy Blokhin] /Adobe Stock

11-12-20

SEC and FINRA Offer Observations to Improve Compliance with Reg BI and Form CRS

On October 26, 2020, the SEC and FINRA staff held a remote public roundtable to discuss the implementation of Reg BI and Form CRS since mandatory compliance began on June 30, 2020. During the regulators' roundtable, staff reviewed the core obligations required by Reg. BI and Form CRS and their observations on firms' compliance with the new rules, including areas where firms require improvement.

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FINRA Proposes Senior Rule Amendments to Extend Hold Period on Senior Accounts and Permit Holds on Transactions in Securities
Image © [leszekglasner] /Adobe Stock

11-05-20

FINRA Proposes Senior Rule Amendments to Extend Hold Period on Senior Accounts and Permit Holds on Transactions in Securities

Based on feedback from a retrospective rule review initiated in August 2019, FINRA proposed rule amendments intended to strengthen the ability of member firms to address suspected financial exploitation of seniors and other vulnerable individuals. The proposed amendments would permit a broker-dealer to impose a longer hold period on a senior investor's account and to expand coverage to include holds on transactions in securities. FINRA seeks comments by December 4, 2020. Please read the full article for a closer look.

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Bates Compliance-SIFMA Webinar Highlighted by WealthManagement
Bates Compliance Director Jill Ehret

10-28-20

Bates Compliance-SIFMA Webinar Highlighted by WealthManagement

A recent article from WealthManagement.com highlights comments made at the Bates Compliance-SIFMA webinar on virtual branch office visits, held October 5, 2020. This webinar is available for on-demand viewing from SIFMA.and features Bates Compliance Director Jill Ehret.

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This Week in Reg BI: SEC-FINRA Roundtable and Bates Compliance-Global Relay Webinar “REG BI - 120 Days On”

10-26-20

This Week in Reg BI: SEC-FINRA Roundtable and Bates Compliance-Global Relay Webinar “REG BI - 120 Days On”

Today, October 26, 2020, the SEC and FINRA staff will hold a remote public roundtable to discuss their observations on the implementation of Regulation Best Interest (“Reg BI”) and Customer Relationship Summary disclosure form (“Form CRS”) since mandatory compliance began on June 30, 2020. Following the program, on Wednesday, October 28, 2020 at 2 pm ET / 11 am PT, Bates Compliance will hold its own webinar with Global Relay to discuss “Reg BI - 120 Days On.”

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SEC Chair and Director of Enforcement Review the Record

10-22-20

SEC Chair and Director of Enforcement Review the Record

In a likely preview of the SEC Division of Enforcement 2020 Annual Report, SEC Chair Jay Clayton and Division of Enforcement Director Stephanie Avakian gave back-to-back speeches regarding the agency’s enforcement record since they took the reins in 2017. In context, these speeches presented a strong accounting of the impact the Division has had on the financial industry during their tenure. The remarks, delivered last month to the Institute for Law and Economics at the University of Pennsylvania Law School, also raised some of the important challenges to the SEC’s enforcement priorities presented by COVID-19. Here are the highlights from their speeches.

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