As brokerage firms throughout the country prepare for Regulation Best Interest’s implementation, Riskalyze announced upgrades to its Select and Elite products intended to help advisors and firms attain and maintain compliance with the SEC’s new rule, which is set to go into effect on June 30.
The fintech provider announced the new additions to its services at the Financial Services Institute’s OneVoice conference in San Diego this week. According to CEO Aaron Klein, “several major wealth management enterprises” had already selected Riskalyze to help ensure they were in compliance with the rule.
“The vast majority of advisors and enterprises that we serve are already compliant with most of Reg BI, and their use of Riskalyze puts them on third base when it comes to complying with the toughest part of the rule —the standard of care,” Klein said.
While SEC officials have stressed that they will not be trying to play “gotcha” after the rule is implemented on June 30, at a FINRA conference in December, John Polise, the associate director of the Broker-Dealer and Exchange Program at the SEC’s Office of Compliance Inspections and Examinations made it clear that firms should not be surprised if an examiner questions firms about Reg BI compliance starting July 1.
According to Riskalyze, their updated services will help brokers assess the risk tolerance for clients, give home offices better visibility of the regulatory process, and help firms catalog the delivery of Form CRS to each retail client (firms have increasingly looked to tech solutions like the ones Riskalyze offers in order to help complete and deliver their Form CRS obligations).
In addition to fulfilling the ‘care’ requirement dictated by Reg BI, a prepared statement from Riskalyze noted its services will also help firms fulfill their need to address documentation, and can help firms address the disclosure of conflicts by building accessible tools so clients can make sense of potential issues in a straightforward report. Ongoing monitoring of compliance and alignment of investment objectives with client proposals and portfolios is the final piece noted among the upgrades. This means that supervision teams can now search for risk alignment "on a sub-asset class lens and account for the risk of different product types including REITs, non-traded REITs, bonds, structured notes, BDCs, fixed annuities and variable annuities, and all US stocks, ETFs, and mutual funds."
