Dear Members and Friends,
As a follow-up to our Advocacy Alert on February 10, 2020, the IPA, SIFMA and FSI have been working closely together to address our members’ confusion, questions and serious concerns with the NASAA Regulation Best Interest Survey (the Survey) as drafted. In response to the Survey, we have prepared a joint trades letter signed by six other associations – including the U.S. Chamber of Commerce – addressing these issues, which we submitted today to NASAA and individual state securities regulators.
Our comments address the following issues:
- Unrealistic timeframe for the Survey’s completion (deadline of 14 days to complete the Survey which will take approximately 1-2 hours)
- Concern on the stated purpose of the Survey (information gathering v. examination/enforcement initiative)
- Authority of regulators to gather broad, open-ended data outside of their jurisdiction
- Confidentiality of information, state authority/public records laws, and use of a commercial tool (SurveyMonkey)
- Lack of workable survey format (yes/no questions and radio box input) and ambiguities in questions asked
- Indication in the Survey questions of a bias against specific product types (including non-listed REITS and private securities)
- Fundamental fairness in allocation of resources to complete the Survey (in light of ongoing Reg BI preparation)
The IPA, SIFMA and FSI will be following up with NASAA’s Reg BI Implementation Committee and individual states following this transmittal.
Today, we also received FAQs for firms prepared by the NASAA Reg BI Implementation Committee. We are reviewing this closely and continue to have many of the same concerns expressed in the coalition letter, including the product-specific focus on non-traded REITs and private securities offerings.
We will continue to provide our members with updates and additional actions by the IPA and our coalition partners. We continue to encourage our members to reach out to us if you have received the NASAA survey or have questions or concerns.
SVP, Government Affairs and General Counsel
Institute for Portfolio Alternatives