When is an RIA a Custodian? @wealth_mgmt talks with @HDelux at the @Pershing Advisor Solutions Regional Symposium.

A long-standing point of confusion for many RIAs is whether or not they are subject to the SEC’s custody rules when moving client assets from one account to another. Many consider having a letter of authorization from the client to move money between accounts exempts them from being considered custodians in the SEC’s eyes. “A recent communication from the SEC reminded them that that is not the case, and they could be subject to the rule, which would require them to obtain a ‘surprise examination’ and an audit of those assets by a qualified accountant,” explains Brian Hamburger, president and CEO of MarketCounsel, a business and regulatory consulting firm for independent advisers.

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When is an RIA a Custodian? @wealth_mgmt talks with @HDelux at the @Pershing Advisor Solutions Regional Symposium.

A long-standing point of confusion for many RIAs is whether or not they are subject to the SEC’s custody rules when moving client assets from one account to another. Many consider having a letter of authorization from the client to move money between accounts exempts them from being considered custodians in the SEC’s eyes. “A recent communication from the SEC reminded them that that is not the case, and they could be subject to the rule, which would require them to obtain a ‘surprise examination’ and an audit of those assets by a qualified accountant,” explains Brian Hamburger, president and CEO of MarketCounsel, a business and regulatory consulting firm for independent advisers.

Read more.

Comments are closed.