Obligations when you have a Series 65

[bballboy8]

Don't know about that specifically. Being a fiduciary as an RIA is kind of a way of thinking and behaving... always disclose everything, customer's interests first, no shady deals, honesty at all times, etc.

Have you had an audit of your RIA? Years ago some RIAs could go an entire career without an audit. I had 4 RIA audits and 2 CFTC audits. Why so many? I think it was because there is a regional SEC office in Denver and they sent out their rookie agents to get some practice on me.

The only gig I ever got was that I didn't have some customer information on their "account card"... like address and phone number (it was elsewhere too, but was supposed to be on that card for "quick reference" by auditors, you know). They sent a follow-up inspection for that one thing to make sure I'd updated those cards as I was supposed to. Imagine that?

Thanks this is helpful. So as long as I'm completely transparent about everything I am speaking about, then I should be ok. Thank you again!

 

[Scataphagos]

Thanks this is helpful. So as long as I'm completely transparent about everything I am speaking about, then I should be ok. Thank you again!

More than just that. If you receive a commission for selling a product or service, you need to disclose that too. If you have a choice to recommend a "no load" product where you make no commission and a "load" product where you do receive commission... you need to justify your recommendations for the load one vs the no load... that is, how is it in the customer's best interest to be charged a load when he could get the same/equivalent with "no load"? And if you do receive commission/fee compensation, it needs to be "reasonable" and not excessive. All of this is part of what it means to be a fiduciary and "put the customer's interest first.... above yours".

When you get your first SEC audit of your RIA, the inspectors will be looking into all of this in fine detail. They will even check your personal banking records to see if you've had financial dealings with customers which may be unethical or illegal... such things a personal loan dealings with customers, investments "outside" your RIA purview, comingling your funds with a customer... etc.

I suggest you don't try to "get away with"... anything.