SEC Advised To Alter Plan Addressing Onerous RIA Arbitration Clauses and Other Senior Protection Issues

Posted on October 21st, 2022 at 1:21 PM
SEC Advised To Alter Plan Addressing Onerous RIA Arbitration Clauses and Other Senior Protection Issues

From the Desk of Jim Eccleston at Eccleston Law.

The Securities and Exchange Commission (SEC) has been urged by several organizations to address investment advisory firms’ use of mandatory arbitration to settle client disputes as well as threats to older investors in its regulatory agenda for the next four years.

The SEC published a strategic plan in August intended to guide the agency’s regulatory oversight between 2022 and 2026. Several organizations, such as the Public Investors Advocate Bar Association (PIABA), provided input recommending that the SEC focus its oversight on how firms require their clients to exclusively use private arbitration forums to file complaints.

Additionally, the AARP has noted its displeasure with the SEC for excluding on its agenda ways to protect senior investors. The AARP is urging the SEC to form an advisory committee to analyze and respond to issues impacting older investors.

Finally, the Chamber of Commerce has raised concerns about the SEC’s enforcement plan in its regulatory agenda in an effort to avoid rulemaking by enforcement. “The SEC must provide clear ‘rules of the road’ for businesses — particularly small and startup businesses – and not use enforcement as a vehicle to establish de facto rules”, according to Tom Quaadman, Chamber executive vice president.

Eccleston Law LLC represents investors and financial advisors nationwide in securities, employment, regulatory and disciplinary matters.

Tags: eccleston, eccleston law, advisors, law, sec

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