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NASAA BROKER-DEALER REPORTS

NASAA Regulation Best Interest Implementation Committee National Examination Initiative Phase Two Report, November 2021

On November 4, 2021 NASAA released the results of a nationwide survey that finds many broker-dealer firms still place their financial interests ahead of their customers despite the implementation of the SEC’s Regulation Best Interest. This report, by the NASAA Regulation Best Interest Implementation Committee, follows NASAA’s 2020 Reg BI Phase One Report that analyzed financial services industry policies and practices prior to the implementation of Reg BI. Details

NASAA Regulation Best Interest Implementation Committee National Examination Initiative Phase One Report, September 2020

This report, by the NASAA Regulation Best Interest Implementation Committee, provides the first comprehensive look at industry practices prior to the implementation of the Securities and Exchange Commission’s Regulation Best Interest and provides important benchmarking data to help measure the effectiveness of the new federal standard of care regulation. Details

Broker-Dealer Section E&O Insurance Survey Report, December 2019

This report, by the NASAA Broker-Dealer Section’s Market and Regulatory Policy and Review Project Group encourages broker-dealers to use errors and omissions (E&O) insurance as a resource to help meet their potential obligations to pay arbitration awards to their customers. The report includes details of an in-depth survey of broker-dealers to determine whether broker-dealers carried E&O insurance and, if so, the scope of coverage of such policies. The report analyzes information obtained from this survey in the context of the unpaid customer arbitration award data released by FINRA. Firms were selected for the survey based on size and location, focusing on small- to mid-sized firms. Details

Broker-Dealer Policies & Procedures for Leveraged and/or Inverse ETFs, July 2019

This NASAA report recommends tailored supervisory procedures be established for firms that allow leveraged and/or inverse ETF transactions. Further, that the supervisory procedures address the heightened and specific risks associated with these complex products. NASAA’s Broker-Dealer Section’s Investment Products and Services Project Group collected information from 118 broker-dealers to gain a better understanding of whether registered representatives are recommending the purchase and sale of leveraged and/or inverse ETFs and, if those purchases and sales are permitted, how firms are supervising such transactions. Details

 

Report on IRA Rollovers, April 2018

In May 2017, the Market and Regulatory Policy and Review Project Group (Project Group), under the direction of the North American Securities Administrators Association (NASAA) Broker-Dealer Section, surveyed broker-dealers concerning their policies and practices for rollovers of investor funds from employer-sponsored retirement plans to individual retirement accounts (IRAs). Details

Report on Senior Practices and Procedures, June 2017

In 2016, the Investment Products & Services project group under the direction of the NASAA Broker-Dealer Section Committee conducted a survey of broker-dealer practices and procedures applicable to senior investors. NASAA greatly appreciates the cooperation of the more than 60 broker-dealers that responded to the inquiry. This report summarizes findings from the inquiry. Details

Report on Accessibility and Standardization of Miscellaneous Broker-Dealer Fees for Retail Customers, September 2015

In the summer of 2014, NASAA convened a Fee Working Group to promote accessibility, standardization, and transparency in the way in which broker-dealer miscellaneous account and service fees are disclosed to retail customers. The Working Group consisted of representatives of NASAA, FINRA, SIFMA, FSI, and  several diverse broker-dealers including LPL Financial LLC, Morgan Stanley Smith Barney LLC, Prospera Financial Services, and Signator Investors, Inc. Starting in the fall of 2014 and continuing into the summer of 2015, the Working Group met to develop meaningful miscellaneous account and service fee disclosure and transparency that is simple to read, easily accessible, and can be used effectively by retail investors to understand and compare fees. Details