Regulations

Hi TPRM Colleagues: 

What primary enforcement agencies and laws/regulations have oversight to how Asset/Investment Management companies conduct their third party risk management programs?  

Much appreciated. 

Two major regulatory agencies oversee the asset management industry: the Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA). While they are separate entities, they overlap with other agencies.

FINRA regulates almost all stockbrokers and representatives of broker-dealers who sell securities to the public. The Financial Industry Regulatory Authority (FINRA) is a self-regulatory organization under the jurisdiction of the Securities and Exchange Commission. The SEC regulates brokerage firms and individual brokers and enforces SEC rules and regulations among its members.

The SEC regulates investment advisors with assets under management (AUM) over $110 million. The term "investment advisor" applies to any firm that gives investment advice. Companies that manage client portfolios are included in this category. Investment advisors and representatives who manage assets under the $110 million AUM must register with their states.

Depending on the firm, other regulatory agencies such as the OCC, US Treasury Dept, and FDIC may also be involved.

Companies that engage in numerous assets management activities and other activities have a high degree of regulatory complexity. In addition to the SEC and FINRA, the Federal Reserve, Treasury Department, and FDIC may regulate investment banks with asset management divisions, wealth management divisions, and traditional banking units.

I hope that information is helpful, but I would like to hear more from other members.