Laboring Toward Completion: The Fate of the Fiduciary Rule

The Department of Labor’s fiduciary rule has been subject to more back and forth than an Olympic table tennis match. Will it go into effect? Will it be repealed? Or will it merely be delayed? The answer seems to change from day to day. Continue reading

judge-gavel-1461291738x4g

 

 

 

Update: On March 1, 2017, the Department of Labor proposed a 60-day delay of implementation of the fiduciary rule. The DOL will allow a 15-day comment period before determining whether to finalize the delay.

***

The Department of Labor’s fiduciary rule has been subject to more back and forth than an Olympic table tennis match. Will it go into effect? Will it be repealed? Or will it merely be delayed? The answer seems to change from day to day. While some groups work toward implementation of the rule, other groups fight against it, questioning whether the Department of Labor even has the authority to issue such a rule.

The fiduciary rule would require financial professionals to put an investor’s interests first—that is, to meet a fiduciary duty—when providing investment advice regarding covered retirement plans.

Let’s look at a brief timeline of the life of the fiduciary rule so far:

February 23, 2015: President Obama called for the Department of Labor to move forward with the creation of rules to limit conflicts of interest regarding investor retirement accounts.

April 14, 2016: The Department of Labor proposed the fiduciary rule, intended to begin implementation on April 10, 2017.

February 3, 2017: President Trump issues an executive order directing the DOL to review the fiduciary rule.

February 8, 2017: A federal district court judge in Texas upheld the Department of Labor’s authority to issue the fiduciary rule.

February 17, 2017: A federal district court judge in Kansas upheld the Department of Labor’s authority to issue the fiduciary rule.

When President Trump issued his executive order, he ordered the Secretary of Labor to provide an “economic and legal analysis” of the rule to answer the following questions:

  • Will it reduce investors’ access to a variety of retirement services, offerings, product structures, or other information or advice?
  • Has it disrupted the retirement services industry in a way that could harm investors?
  • Is it likely to increase the amount of litigation in the industry and thereby cause an increase in prices for investors?

If the Secretary of Labor determines that the answer to any of these questions is yes, it must revise or rescind the rule.

However, many firms are proceeding with their plans to implement the fiduciary rule whether or not the rule as it now exists goes into effect.  For example, Merrill Lynch has said it will no longer offer commission-based brokerage IRA accounts. Instead, the firm will offer level fee investment advisory services regardless of the outcome of the fiduciary rule.

Senator Elizabeth Warren of Massachusetts reached out to over thirty leading finance companies, and the overall response from the companies that responded was that they support the fiduciary rule and are prepared to implement it. For example, TIAA wrote, “Putting our clients’ best interests first is a core value at TIAA and, accordingly, we support a best-interest standard,” and Fidelity noted that the firm is “fully prepared to comply with the rule if and when it becomes applicable.”

So even though we don’t know what will be the ultimate fate of the DOL fiduciary rule, it’s safe to say that it has already begun to change the face of the financial industry.

For more information about the DOL fiduciary rule, see our earlier blogpost: https://solomonexamprep.com/news/finra/ready-or-not-here-it-comes-the-dol-fiduciary-rule-2/.

 

Solomon Exam Prep Partners with PreLicense.com!

Solomon Exam Prep is pleased to announce that PreLicense.com has chosen to partner with Solomon Exam Prep to provide an online study program for the Series 6 and Series 63 qualification exams. Continue reading

series-6Solomon Exam Prep is pleased to announce that PreLicense.com has chosen to partner with Solomon Exam Prep to provide an online study program for the Series 6 and Series 63 qualification exams. PreLicense.com’s new Series 6 and Series 63 courses include the Solomon study guide,
practice quizzes, and full-length practice tests.

“We are honored that PreLicense.com has chosen Solomon Exam Prep to partner as their securities exam prep partner,” said Jeremy Solomon, co-founder of Solomon Exam Prep. “A securities exam is not just a regulatory requirement, it’s also an important learning experience. We look forward to educating many more individuals through this series-63exciting partnership.”

For more information about the Series 6 or Series 63 exams, or any other securities licensing exams, go to SolomonExamPrep.com or call 503-601-0212.

Study Question of the Month – November 2016

This month’s study question from the Solomon Online Exam Simulator question database is now available!

***Submit your answer to info@solomonexamprep.com to be entered to win a $10 Starbucks gift card.*** Continue reading

Congratulations to Tony P., this month’s Study Question of the Month winner! 

See the answer below!

***Submit your answer to info@solomonexamprep.com to be entered to win a $10 Starbucks gift card.***

studyQuestion

 

 

 

 

 

Question (Relevant to the Series 63, Series 65, and Series 66)

Nigel is a successful agent of a Canadian broker-dealer in Manitoba. The firm he works for has no offices in the U.S., and he has no interest in moving to the U.S. One of his biggest clients, Beatrice, is in temporary residence in Minnesota settling her mother’s estate. Nigel wants to keep Beatrice as a client but he is not registered in the U.S. and doesn’t know if he can continue to work with Beatrice under the current situation. What is your advice?

A. Nigel needs to bite the bullet and move to the U.S. where he can register in Minnesota and continue to transact business for Beatrice, including possibly reinvesting any proceeds of her mother’s estate.

B. Nigel cannot continue to transact business for Beatrice, since he is not registered in Minnesota and does not want to move to the U.S.

C. Nigel can transact business for Beatrice without problems. Canada and the U.S. have a reciprocity agreement that allows such international business relationships.

D. Nigel can transact business for Beatrice after he obtains a limited registration in Minnesota.

Answer: D. If the Canadian firm does not have offices in the U.S. state (which it does not), and the client is from Canada and is temporarily in that state (which Beatrice is), and had a relationship with the Canadian broker-dealer before entering the state (which Beatrice did), then an agent or broker-dealer may use a limited registration. Nigel has a good many hoops to jump through to get that limited registration, but because Beatrice is a big client, you would advise him to do so.

Announcing the Release of the Solomon Exam Prep Android Mobile App!

With the release of the Solomon Exam Prep app, you have full mobile access to your Solomon study materials with the click of a button. Continue reading

Do you need to take a securities licensing exam?

Do you wish you had more time to study?

With the release of the Solomon Exam Prep Android app, you have full mobile access to your Solomon study materials at the click of a button.

  • Easier and quicker—Just click the Solomon Exam Prep icon on your phone to be taken directly to your account.
  • Access all your materials—The app provides full site functionality and access to your study guide, exam simulator, audiobook, and video lecture.
  • No typing on tiny keyboards—Don’t worry about typing in a web address! Our app will take you right where you need to be.

Move into the future of mobile securities exam prep with the Solomon Exam Prep app!

To download the app, please visit: goo.gl/IkNceh

Solomon Exam Prep has helped thousands of financial professionals pass their FINRA, NASAA, and MSRB licensing exams, including the Series 6, Series 7, Series 24, Series 26, Series 27, Series 28, Series 50, Series 51, Series 52, Series 53, Series 62, Series 63, Series 65, Series 66, Series 79, Series 82, and the Series 99.

blog 1blog 2blog 3

SEC Announces IA Recordkeeping Rule Amendments

Put your records where your mouth is—that’s the message the SEC is sending to investment advisers. Continue reading

SONY DSC

Put your records where your mouth is—that’s the message the SEC is sending to investment advisers.

The regulatory agency has amended Advisers Act rules to require investment advisers to keep records of all documentation that shows “performance calculations or rates of return.” This includes any communications that a firm receives as well as copies of any communications that it sends.

The change will make it easier for the SEC to identify misleading claims made by investment advisory firms.

The SEC has also made changes to Form ADV, including:

  • Revisions to require additional info about such things as the firm’s separately managed accounts business
  • A revision that requires IAs to provide a list of web address for all their social media pages
  • Amendments that allow private fund adviser entities that operate a single advisory business to complete registration by filing just one Form ADV

SEC Chair Mary Jo White says that these changes “will provide investors and the Commission with a better understanding of the risk profile of each adviser and the industry as a whole.”

The amendments will be published in the Federal Register, and they will become effective 60 days after publication. Advisers are required to begin complying with the amendments no later than October 1, 2017.

Updated Series 63, 65, and 66 Materials Now Available!

On July 1, the North American Securities Administrators Association (NASAA) updated the Series 63, Series 65, and Series 66 exams. That means new material was added to the tests—material you need to know if you want to pass. Continue reading

On July 1, the North American Securities Administrators Association (NASAA) updated the Series 63, Series 65, and Series 66 exams. That means new material was added to the tests—material you need to know if you want to pass.

That’s where Solomon comes in. We updated our Series 63Series 65, and Series 66 Study Guides and Online Exam Simulators so our customers don’t have to worry about being left behind by these changes.

Here are a few of the new topics:

• Exceptions for foreign broker-dealers
• Broker-dealer supervision of agents
• Prospectus delivery requirements
• Types of customer accounts
• Broker-dealer and agent commissions
• Cyber security and data protection
• Outside securities accounts
• Due diligence for broker-dealers
• Regulation A amendment
• Regulation D amendment

You can purchase each Exam Study Guide with our industry-leading Online Exam Simulator as part of our Essentials Study Package.

For a limited time, Like us on Facebook to get a coupon code for 10% off packages!

Want more information? Call 503.601.0212 or go to SolomonExamPrep.com.

Upcoming Series 63, 65 and 66 Changes

The North American Securities Administrators Association (NASAA) has announced that it will implement updates to the Series 63, Series 65 and Series 66 examinations on July 1, 2016. What has changed? Continue reading

The North American Securities Administrators Association (NASAA) has announced that it will implement updates to the Series 63, Series 65 and Series 66 examinations on July 1, 2016.

The changes are aimed at better aligning the skills and knowledge required by professionals in the securities industry.

The new exam outlines are similar to the current exam outlines, but some significant changes have been made.

What has changed?

Series 63                                                         

  1. The weighting of the exam sections has been modified to put more emphasis on the registration of broker-dealers over investment advisers
  2. Several new topics have been added which reflect an emphasis on communications with customers and cyber-security. Specifically, the following topics have been added or amended:
  • Exceptions for foreign B-Ds
  • B-D supervision of agents
  • Prospectus delivery requirements
  • Types of customer accounts
  • B-D and agent commissions
  • Cyber-security and data protection
  • Outside securities accounts
  • Due diligence for B-Ds
  • Regulation A amendment
  • Regulation D amendment

Series 65                                                         

  1. The weighting of the exam sections has been modified to put slightly more emphasis on the characteristics of investment vehicles and slightly less emphasis on rules and regulations.
  2. Several new topics have been added which expand the types of investment products and add regulations on electronic communications, cyber-security, pay-to-play and anti-money laundering. Specifically, the following topics have been added or amended:
  • Valuation of equity securities
  • Real estate investments
  • Viatical and life settlements
  • Structured products
  • Commodities and precious metals
  • QDROs
  • High frequency trading
  • Regulation A amendment
  • Regulation D amendment
  • Electronic communications and social media
  • B-D and agent commissions
  • Cyber-security and data protection
  • Pay-to-play rule
  • Anti-money laundering
  • Business continuity plans

Series 66                                                         

  1. The passing score has been lowered from 75% to 73%.
  2. The weighting of the exams sections has been modified to put slightly more emphasis on the characteristics of investment vehicles and slightly less emphasis on rules and regulations
  3. Several new topics have been added which expand the types of investment products and add regulations on electronic communications, cyber-security, pay-to-play and anti-money laundering. Specifically, the following topics have been added or amended:
  • Valuation of equity securities
  • Technical analysis
  • Real estate investments
  • Viatical and life settlements
  • Structured products
  • Commodities and precious metals
  • QDROs
  • High frequency trading
  • Regulation A amendment
  • Regulation D amendment
  • Electronic communications and social media
  • B-D and agent commissions
  • Cyber-security and data protection
  • Pay-to-play rule
  • Anti-money laundering

How will this affect my Solomon Exam Prep products?

Solomon Exam Prep will be updating all products offered for the NASAA exams. For those students that currently have materials and are testing after July 1, 2016, we have added an addendum to their Resources folder (located on their student account), that includes all rule changes and updates.

Our Online Exam Simulator has already been adjusted to reflect the new changes, so students will see an option to take full exams structured prior to July 1 or after July 1 – this will allow for any and all students to utilize our products regardless of their anticipated exam date. We are always adding new questions to our database and that will be reflected in the Online Exam Simulator.

In the coming weeks we will also be releasing a new/ updated digital Study Guide that will reflect the upcoming changes. Any current students will have the option of having their digital Study Guide changed to the new edition at that time, or they can continue to study with our current edition and the supplied addendum.

If you have any questions about the changes or our materials, please do not hesitate to call our office at 503.601.0212 or email info@solomonexamprep.com.

Changes Coming Soon to Series 63, Series 65 and Series 66 Exams

The North American Securities Administrators Association (NASAA) has announced that it will implement updates to the Series 63, 65 and 66 examinations on July 1, 2016. Continue reading

Newspaper Change Is ComingThe North American Securities Administrators Association (NASAA) has announced that it will implement updates to the Series 63, 65 and 66 examinations on July 1, 2016.

The changes are a result of a review of the exams by NASAA and Prometric and are being put into effect to update and align skills and knowledge required by those in the securities industry.

The weighting of the exams will be modified, as will the number of questions for each topic. The passing score for the Series 63 and 65 will not change, but the Series 66 passing score will be lowered from 75% to 73%.  “Everyone who has to take the Series 66 exam should be happy to hear that,” says Solomon Exam Prep President, Jeremy Solomon, “as well as anyone related to someone who has to take the Series 66 exam.”

New topics will be added to each exam, for example including more on advertising and correspondence. The Series 65 and 66 will include new areas of focus on custody obligations and anti-money laundering. Other topics on the exams will be de-emphasized, while others will be expanded, combined or renamed for the sake of clarity.

Solomon Exam Prep will be making updates and changes to its industry-leading Series 63, Series 65 and Series 66 exam study program to prepare students for the revised exams. Students will receive additional resources with updates as they are made available. Upon publication of the 2nd edition, students may request a free upgrade of their digital guide. Hard copy guides will not be replaced.

For more information, see: http://www.nasaa.org/industry-resources/exams/exam-change-announcement/