CHAPTER 2 Regulatory Considerations
Investment advisors and consultants are subject to numerous laws and regulations that apply to the activities in which they engage, the products and services they provide, and the relationships they have with specific clientele they serve. Depending on these activities, products and services, relationships, and the jurisdictions in which they work, investment professionals may be subject to oversight by the following regulators: the SEC (Securities and Exchange Commission), FINRA (Financial Industry Regulatory Authority), and state securities boards or agencies among others.
This chapter explores fiduciary responsibilities, direct and indirect relationships, the principal-agent relationship, disqualified persons, prohibited transactions, and various laws and regulations that apply to investment advisors and consultants.
Learning Objectives
- Define the term “fiduciary” and describe the fiduciary responsibility of CIMA® designees.
- Describe the principal-agent relationship between investment professionals and individuals, trusts, foundations, endowments, and ERISA plan clients.
- Identify circumstances that may cause a person to be identified as a fiduciary.
Describe laws that apply to investment advisors and consultants, including:
ERISA (Employee Retirement Income Security Act)
UPIA (Uniform Prudent Investor Act)
UMIFA (Uniform Management of Institutional Funds Act)
UPMIFA (Uniform Prudent Management of Institutional Funds Act)
Other international, ...
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