Large BD Failed to Submit FA Training Materials to Compliance
The Massachusetts Securities Division fined a large broker-dealer $2.5 Million for failing to submit financial adviser training materials to the Compliance Department. The MSD alleges that the training materials focused on how financial advisers could increase their revenues by transitioning clients from traditional brokerage accounts to fee-based advisory accounts. The MSD asserts that the presentations did not include adequate training slides on suitability and fiduciary responsibility. According to the MSD, Compliance either did not have the opportunity to review the materials or reviewed different versions that the presentations actually utilized. The MSD charges the firm with failure to supervise.
OUR TAKE: At least the MSD held the business people, rather than Compliance, responsible for the presentation materials. Compli-pros are regulatory advisors, not hall monitors that you are trying to avoid while breaking school rules.