Form CRS FAQs Require Multiple Relationship Summaries
The staffs of the SEC’s Divisions of Trading and Markets and Investment Management have issued additional FAQs on Form CRS that clarify when a financial adviser must deliver additional relationship summaries. A financial adviser must deliver an additional Form CRS (i) for its broker-dealer if unaffiliated with its investment adviser; (ii) when converting from an advisory to a brokerage account; and (iii) when offering a new type of service that relates to a customer’s investment options. The new FAQs also address wrap programs, prospective customers, and recordkeeping. The staffs remind firms that Form CRS “is designed to serve as disclosure, rather than marketing material” and should hew closely to the Form instructions.
We are now up to 21 pages of FAQs on Regulation BI and Form CRS, and the rules just went live. We encourage all compli-pros to review the FAQs for guidance on their firms’ particular situations.