On November 30, 2020, the North American Securities Administrators Association (NASAA) announced its membership has voted to adopt a model rule to set parameters by which NASAA members could implement continuing education programs for investment adviser representatives (IARs) in their jurisdictions.
The model rule will require IARs to complete 12 hours of continuing education annually, revolving around two components: products and practices, and ethics and personal responsibility.
According to Lisa A. Hopkins, NASAA President and West Virginia Senior Deputy Securities Commissioner, the new rule will improve the ability of IARs to provide their clients the best and most knowledgeable services. “This successful collaboration will help promote heightened regulatory compliance while also helping investment adviser representatives better serve their clients by remaining knowledgeable of current regulatory requirements and best practices,” Hopkins said.
Completing FINRA requirements can help to ensure you’re in compliance with the new NASAA rule.
Investment advisor representatives who are registered with a FINRA member broker-dealer and who comply with FINRA’s continuing education requirements are considered to be in compliance with the subrule (1)(B) IAR Products and Practice Requirement for each applicable Reporting Period.
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- To ensure these criteria are fully met, advisers should ensure FINRA continuing education content meets all of the following baseline criteria:
- The content of the continuing education program must fall within the categories delineated by the model rule – products and practices, or ethics and personal responsibility.
- The CE content must be derived from industry rules, regulations, and accepted standards and practices in the investment advisory industry.
- The CE content includes a requirement to demonstrate proficiency in the subjects being covered by the training.
- Credits must be appropriately reported during the proper reporting periods.
- The requirements in the IAR’s home state must be at least as stringent as the NASAA Model Rule and the advisor must be in compliance with their home state’s requirements.
A complete copy of the model rule can be found here. If you need additional support with training programs, our consulting team provides resources to educate and prepare your team for serving clients and staying in compliance.
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About Red Oak Compliance Solutions
Red Oak Compliance Solutions is a leading provider of intelligent compliance software, offering a range of AI-powered solutions designed to help firms of all sizes successfully navigate the increasingly complex regulatory landscape. Our suite of 17(a)-4/WORM compliant features offer risk minimization, cost reduction, and process optimization capabilities with features that are designed to evolve with our client’s needs. Our flagship advertising review software enables firms to deliver compliant content to the market with confidence, faster. Our Disclosure Management and Intelligence solution simplifies the management of disclosures, while our Registration Management solution automates and streamlines the licensing and registration process, further enhancing your internal processes.