Compliance Solutions

Regulation Best Interest

Regulation Best Interest (“Reg BI”) is an expansive regulatory change that will impact the fundamental business structure of financial services organizations and create new regulatory and compliance risks. The development of core compliance and supervisory components will help firms address the burden of compliance departments in the broker-dealer industry.

The SEC voted on June 5th, 2019 to approve a set of proposals setting new conduct standards for broker-dealers. Reg BI is part of a package of rules and interpretive guidance directing broker-dealers to act in the “best interest” of their clients. The package also includes new compliance requirements and guidance for both broker-dealers and investment advisers concerning the new obligations owed to retail investors.

Deadline Information:

The adoption of Reg BI by the SEC marks the start of a very short compliance implementation phase. The SEC stated that the interpretative guidance will be effective upon publication in the Federal Register. (The rules and forms will be effective 60 days later.) Broker-dealers must begin complying with the new rule, and broker-dealers and investment advisers must prepare, deliver to investors, and file the customer relationship summary by June 30, 2020.

How Bates Compliance Can Help:

Bates Group’s compliance consultants can help your firm through the implementation phase of Reg BI. We help you navigate:
  • Disclosure obligations
  • Duty of care obligations
  • Conflicts of interest obligations
  • Additional compliance obligations
Bates Compliance can also assist you with:
  • Developing the new Reg BI Client Relationship Summary (“CRS”) for retail investors
  • Navigating additional compliance requirements for BDs and IAs
  • Understanding new SEC guidance concerning the “Solely Incidental” registration exemption of the Investment Advisers Act
  • Impact and readiness assessments
  • Conflicts of interest inventory
  • Conflicts of interest assessment
  • Product shelf reviews
  • New product approval processes
  • Drafting new policies and procedures
  • Data capture and recordkeeping




Read More:

News & Events:

  • Bates Group CEO Jennifer Stout and Compliance Director JIll Ehret spoke on Reg BI Developments at the IBDC 2019 Annual Conference, October 28-30 in San Diego. Bates was a proud Platinum sponsor of this event.
  • Bates Managing Director Hank Sanchez discussed Reg BI and other "Hot Topics in Compliance" at the SIFMA C&L New York Regional Seminar on October 22nd.
  • Jill Ehret was a panelist at the 2nd Annual FI Summit, August 14, 2019 in Los Angeles. The panel discussed Reg BI and its anticipated impact upon broker-dealers, registered representatives, registered investment advisers, and investment adviser representatives. Bates was a co-sponsor of this year's summit.

Contact Bates Group

Bates Group is with you every step of the way. Contact us today for more information on how our End-to-End Solutions can help your firm.

Contact Bates Group