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SIFMA Chair-Elect and CEO of the Global Private Client Group of Raymond James Financial, Inc., Chet Helck today testifiedbefore the House Financial Services Committee on the establishment of an independent, self-funded regulatory organization (IRO) for retail investment advisers and expressed SIFMA’s support of H.R. 4624, the Investment Adviser Oversight Act.
“Over the years, the retail advisory services of investment advisers and broker-dealers have converged and in some cases, become indistinguishable, particularly for individual clients” said Helck in his testimony. “Where the services have become essentially identical, we believe that individual clients would benefit from, and be better protected by, consistent standards, consistent examination, and consistent oversight for investment advisers and broker-dealers.”
In testimony, Helck noted that SIFMA’s support for an IRO for retail advisers is premised on the recognition that broker-dealers provide some of the same services as investment advisers, and that when brokers and investment advisers provide the same service, they should be held to the same standard with uniform examination and oversight for compliance with that standard.
Helck also discussed some of the more specific reasons SIFMA supports H.R. 4624, which include:
- The bill fills a gaping void in current investment adviser oversight, by creating a retail adviser IRO that will increase the amount and frequency of investment adviser examinations and oversight, while relieving long-standing pressure on the limited examination resources of the SEC;
- The bill strikes an appropriate balance among the interests of ensuring robust retail adviser oversight, avoiding an unreasonably burdensome and costly regulatory regime, and providing for appropriate transparency and accountability of the organization; and
- The bill provides an opportunity to improve upon, and likewise enhance, the existing regulatory organization regime that now applies to broker-dealers.
