Practice Points from Todays Webinar

Practice Points from Todays Webinar


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Full video transcript available below:

What are the practice points that we learn in this sort of brief webinar? One is I will tell you if you're a compliance person follow the money, that's the easiest thing, or follow the benefit. Why is someone doing what they're doing? Are they receiving, are they paying, is it properly disclosed? That's what the SEC does in exams is they follow the money. Two, you might think you can disclose your way out of revenue sharing practices, pay to play very often you can't. Depending on the nature of the revenue sharing and some of the cases I referenced without a significant structural change just saying, yes I'm disclosing I have a massive conflict of interest to use certain funds, because they pay me more is probably not going to get you out of the problem. There are certain problems that the SEC will not let you disclose your way out of. Don't forget to collect those solicitation disclosures. If you're doing separate account business, and you're paying a third party solicitor the SEC will look for those disclosures during an exam. Think about the regulatory registration requirements of the solicitors themselves, are they a broker/dealer, are they an advisor, and could you be held as aiding and abetting their regulatory violations?

As you think about political contributions, and all these rules, and sort of the strict liability nature of 20645, and G37 should you just ban political contributions, is it really necessary to require that, is anyone really benefiting from that? Don't forget new employees, this is a real pot hole people fall into making sure that they haven't contributed, and it becomes a real sort of sensitive issue during an interview, a political issue. As you're thinking about political contributions you should do some public research. As you get some certifications you should do some email monitoring, but also my recommendation is to check out some of the public sites, and do some spot checking on your people to make sure that they have disclosed everything. That is a brief summary of revenue sharing, and pay to play in the new world. At this point we're sort of toward the end here, but I'm ready to take some questions.

This webinar was co-hosted with Cipperman Compliance Services, LLC

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