Cybersecurity is one of the biggest compliance issues facing registered investment advisors today, and the regulators are making it a top priority. A new Financial Planning Association survey, sponsored by TD Ameritrade Institutional, found that while seven in 10 advisors are aware of the risks associated with cybersecurity, less than a third (29 percent) say they are fully prepared to manage and mitigate those risks. Less than half (44 percent) of the 1,000 advisors surveyed fully understand the issues and risks associated with it. Only about a quarter of advisors say they know what’s required from the Securities and Exchange Commission’s Office of Compliance Inspections and Examinations. "The reality is cyber fraud is pervasive and advisors cannot eliminate the threat, but they can reduce their risk. The more that advisors make themselves familiar with safeguarding systems, adopt best practices and create a detailed security plan, the more they can protect their firms and clients," said Bryan Baas, TD Ameritrade Institutional's director of risk oversight and control.
Personal Capital Passes $3 Billion AUM
Online advisory firm Personal Capital announced Thursday that it now manages more than $3 billion in assets, just six months after the firm crossed the $2 billion landmark. And while other digital advice services have struggled to grow average account size beyond $20,000 (some suggest that the robo advisors have struggled to even maintain that), Personal Capital said its average client invests $300,000. The company also has another 1.2 million people using online tools to track $270 billion. Bill Harris, the CEO of Personal Capital, said, “Our model is three to five years ahead of traditional wire houses or robo advisors combined, and our 100 percent annual growth rate shows that demand for our hybrid approach is only growing.”
Former Financial Advisor Suing Police After Being Falsely Arrested
A former financial advisor from Denver is suing the police department and FBI for $10 million after being falsely arrested for bank robbery. Steve Talley, 46, was arrested in September 2014 after police received a tip that he was the man seen in surveillance photos following a bank robbery. A SWAT team showed up at his home and arrested him, causing several broken ribs, prolonged bruising, lost teeth and severe blood clotting in his legs and feet, CBS Denver reports. "I had airtight alibis but they focused on me all because my face was similar, even though everything else was different,” Talley said. As a financial analyst for Transamerica Capital, Talley said his job was to be on the phone all day, selling mutual funds and talking to other financial advisors. All those phone calls were recorded and the case was dismissed. He was arrested a second time by police claiming they had new evidence, but those charges were already dropped. In all, he spent 94 days in jail. "They destroyed my life, to go from a financial professional to be a person that’s actually homeless now," he said.
