NEW CHANGES - Say Good Bye SEC Reporting

[budfox7]

I just got off the phone the other day with my bd, Finra was in @ my firms HQ doing their wonderful surprise audits. Got a call from compliance about the sale of index annuities.

1) No Matter what B/D you are with, FINRA is wanting all their firms and members to "supervise" the sale of all index annuities and are discouraging firms to allow their advisors to sell away with other FMOs. Come next year, Finra could potentially be asking the compliance officers at your BD's to get all the 1099's of their advisors to make sure. I heard this is in the works as we speak......

2) SEC is getting frustrated with the new waves of RIA's popping up all over the place. A)Agents do not want to get their 6 or 7 and just take the 65 B) Advisors that are with a finra broker dealer and have Series 6 or 7 are leaving their licenses go because they are sick of the constant scrutiny

Heres what I couldnt believe thats going to bite us all in the A$$. SEC is fed up with all the advisor and agents, they are literally going to hand off everything to FINRA. Finra will now be in charge of the WHOLE GAMMIT. No more running away boys, since rule 151A didn't get passed , this is just another loop hole they are going to corner us in.

I am series 7, 66 LHVA the best thing to do is just get licensed up, its coming hard boys! Do not let your license dry up or if you dont have your securities license quit be lazy and get it!!!!

JUST MY 2 cents, I am not saying this is going to happen, I am simply saying what I heard through the grapevine.

 

[DHK]

You're telling us all this garbage because YOU'RE with a B/D... and you're telling US to get licensed to JOIN IN???

What you're ACTUALLY trying to tell us... is that just obtaining a series 65 isn't going to be an option if you wanted to avoid being regulated by FINRA.

Of course, if you don't actually have custody of assets, would the STATES be willing to give up their compliance oversight of RIAs in their state to FINRA? Somehow, I don't think so... and I'd feel better with 50 state regulators... over the power-hungry FINRA.

 

[iceco1d]

Lots of this is speculation. FINRA definitely WANTS to do the whole show. I don't think the SEC cares that much either way, and the states probably could do without the hassle.

However, I think the RIA movement has legs, and there would be stiff opposition to FINRA taking over entirely.

I wouldn't panic, but I'd stay tuned.

 

[polariscompliance]

The number of RIAs is rapidly increasing due to the escape of increasing FINRA regulation, as well as increased customer demand for fee-based products/platforms. Because of the rapidly increasing number of advisors and the lack of resources for sufficient oversight, the first step was for the SEC to pass some of this off to the States, which is exactly what happened with Dodd Frank last year and increasing the SEC-registered advisors to $100M AUM. Now that's passed, certain members of Congress believe there should be an SRO for RIAs, much like FINRA is the SRO for broker dealers. I'm not sure if this will actually happen, as FINRA is struggling from its extreme losses last year, and I think they would be better off creating an entirely new SRO, rather than hand everything over to FINRA, if they feel one is necessary. Here is an article relating to this that came out last week on OnWallStreet:

Bachus Introduces Bill to Clear Way for FINRA to Become Industry SRO - On Wall Street

 

[Stephen]

Budfox7 do you have a link that you can share?

 

[budfox7]

The number of RIAs is rapidly increasing due to the escape of increasing FINRA regulation, as well as increased customer demand for fee-based products/platforms. Because of the rapidly increasing number of advisors and the lack of resources for sufficient oversight, the first step was for the SEC to pass some of this off to the States, which is exactly what happened with Dodd Frank last year and increasing the SEC-registered advisors to $100M AUM. Now that's passed, certain members of Congress believe there should be an SRO for RIAs, much like FINRA is the SRO for broker dealers. I'm not sure if this will actually happen, as FINRA is struggling from its extreme losses last year, and I think they would be better off creating an entirely new SRO, rather than hand everything over to FINRA, if they feel one is necessary. Here is an article relating to this that came out last week on OnWallStreet:

Bachus Introduces Bill to Clear Way for FINRA to Become Industry SRO - On Wall Street

Exactly, my point! You couldnt have said any better.
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Budfox7 do you have a link that you can share?

I am sure you can find one on the WSJ.....I got my information from Finra rep and compliance officer.
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Lots of this is speculation. FINRA definitely WANTS to do the whole show. I don't think the SEC cares that much either way, and the states probably could do without the hassle.

However, I think the RIA movement has legs, and there would be stiff opposition to FINRA taking over entirely.

I wouldn't panic, but I'd stay tuned.

Your right they do have Legs, and they are sexy. Sexy enough to have a big brother rub his hands all over them. Weither its Finra or another SRO, be prepared sport!
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You're telling us all this garbage because YOU'RE with a B/D... and you're telling US to get licensed to JOIN IN???

What you're ACTUALLY trying to tell us... is that just obtaining a series 65 isn't going to be an option if you wanted to avoid being regulated by FINRA.

Of course, if you don't actually have custody of assets, would the STATES be willing to give up their compliance oversight of RIAs in their state to FINRA? Somehow, I don't think so... and I'd feel better with 50 state regulators... over the power-hungry FINRA.

Come down dude, I am just passing information on the forum. And I dont think this is garbage this is useful information for the lucky ones that have to find out what to do next.
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You're telling us all this garbage because YOU'RE with a B/D... and you're telling US to get licensed to JOIN IN???

What you're ACTUALLY trying to tell us... is that just obtaining a series 65 isn't going to be an option if you wanted to avoid being regulated by FINRA.

Of course, if you don't actually have custody of assets, would the STATES be willing to give up their compliance oversight of RIAs in their state to FINRA? Somehow, I don't think so... and I'd feel better with 50 state regulators... over the power-hungry FINRA.

And YES I am saying that you will be eventually regulated by some one other then SEC if you are 65, which I got that license too

 

[maksim]

Honestly though, if you are selling a FIA, why shouldn't you be securities licensed? I mean, the product is harder to understand than a Variable annuity. lol. At the very least, should be a fiduciary duty to the client.

 

[iceco1d]

Honestly though, if you are selling a FIA, why shouldn't you be securities licensed? I mean, the product is harder to understand than a Variable annuity. lol. At the very least, should be a fiduciary duty to the client.

Hey Maks, here's a good reason to not be securities licensed to sell FIAs...

THEY AREN'T SECURITIES!!!

See my other post on this subject. You could construct a FIA where interest crediting is tied to the results of a Roulette wheel. Principal plus a GMIR would be able to be guaranteed. Interest would be credited depending on whether your color (or number, etc.) comes up.

So by your logic, someone doing that should have to have a dealers license in Vegas?

I have a better idea. I think that any rep that cannot explain why a FIA should NOT require a securities license, should be barred from selling them. How about them apples?

 

[Newby]

Honestly though, if you are selling a FIA, why shouldn't you be securities licensed? I mean, the product is harder to understand than a Variable annuity. lol. At the very least, should be a fiduciary duty to the client.

You have to be kidding!

Using your logic, why wouldn't life insurance require a securities license?

Taxes are complicated too. Why shouldn't it require a securities license to figure taxes?

 

[xrac]

You have to be kidding!

Using your logic, why wouldn't life insurance require a securities license?

Taxes are complicated too. Why shouldn't it require a securities license to figure taxes?

Newby is absolutely correct. FINRA wants to eventually control everything including insurance. We should all fight FINRA with everything we have got.