The Securities and Exchange Commission is not fulfilling its duty to protect retail investors, particularly in how it regulates financial advisers, a number of consumer groups asserted in a letter to the agency.

The eight-page letter dated March 10 outlines several areas that the groups say the SEC “can no longer afford to relegate … to a back burner.”

Most of the letter concentrates on ways the groups want the agency to improve regulation of financial advisers and urged the SEC to take “concrete steps” to raise investment-advice standards for brokers.

The Dodd-Frank law gave the SEC the authority to promulgate a uniform fiduciary standard for retail investment advice that would require all advisers to act in the best interests of their clients. The SEC has not acted. Meanwhile, the Department of Labor is poised to re-propose its own fiduciary-duty rule for advice to retirement accounts.

The topic has split the five-member commission. Chairwoman Mary Jo White has promised since November to make her position on fiduciary duty known in the “short term.”

Duane Thompson, senior policy adviser for Fi360, a fiduciary-duty training firm, agreed with the consumer groups that fiduciary duty has languished.

“The SEC seems to have looked more at capital-formation issues,” Mr. Thompson said. “The elephant in the living room is the uniform fiduciary standard. While Mary Jo White has repeatedly said it’s a priority, I’ve never seen it show up on the SEC’s regulatory agenda.”

Other topics the letter highlights include strengthening financial adviser disclosure about conflicts and compensation, reforming revenue-sharing, limiting mandatory arbitration for investor disputes, and beefing up regulation of risky financial products, including some kinds of exchange-traded funds.

“We are concerned that the Securities and Exchange Commission — which has always prided itself on serving as ‘the investors’ advocate’ — appears in recent years to have strayed from its primary focus on its investor protection mission,” the letter stated. “Given the vital role that average investors play in our markets and the overall economy, and the serious shortcomings that exist in the regulatory protections they receive, it is time in our view for these issues to be prioritized.”

Click here to read the entire article from InvestmentNews.

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Brokerdealer.com blog update is courtesy LinkedIn “InFluencer” and Business Analyst at CBS News, Jill Schlesinger. 

The White House wants to change the way brokers provide advice on retirement accounts. President Obama will endorse a Department of Labor proposal, which would require brokers to act in a customer’s best interest—the so-called FIDUCIARY duty—when working with retirement investors. The rule change is intended to crack down on “backdoor payments and hidden fees,” which cost retirement savers $8 – $17 billion a year, according to Jason Furman, chairman of Obama’s Council of Economic Advisers.

As you might expect, the financial services industry is not happy about the potential shift. The Securities Industry and Financial Markets Association says “This proposal would lead to a number of negative consequences for individual investors.”

I know what you’re thinking: How could a rule that puts my interests first, be bad? Well, according to the SEC, the idea that the industry is plagued by conflicts of interest, “has nowhere been proven,” and would effectively overhaul the entire regulatory regime, ignoring “eight decades of securities laws and regulations. The real kicker, however, is that this is not a Commission rulemaking.” This is a not-so-subtle shot at the Department of Labor, which in issuing this rule change, is stomping on SEC territory. Nothing like an inter-departmental catfight!

In fact, SEC Commissioner Daniel Gallagher thinks that it is “curious” that the DOL didn’t consult with the SEC, especially given that the SEC maintains comprehensive oversight authority with respect to the investment advisers and broker-dealers who would be impacted by the change. Gallagher underscores that the DOL ignores SEC rules, which already address underlying conflicts of interest. But here’s the nut of the problem, according to the SEC: there is no evidence that the industry is plagued by conflicts of interest and the new rules could limit investor access to qualified investment advice and investment products.

The proposal will likely be put out for public comment for several months, so for those who need a refresher on investment professionals and their designations, here are some terms to consider:

Investment advisor: If the advisor is registered as an IA, he or she owes you a fiduciary duty, which is a fancy way of saying that she must put your needs first. Investment professionals who aren’t fiduciaries are held to a lesser standard, called “suitability,” which means that anything they sell you has to be appropriate for you, though not necessarily in your best interest.

CFP® certification: The Certified Financial Planner Board of Standards (CFP Board) requires candidates to meet what it calls “the four Es”: Education (Education (through one of several approved methods, must demonstrate the ability to create, deliver and monitor a comprehensive financial plan, covering investment, insurance, estate, retirement, education and ethics), Examination (a 10-hour exam given over a day and a half), Experience (three years of full-time, relevant personal financial planning experience required) and Ethics (disclosure of any criminal, civil, governmental, or self-regulatory agency proceeding or inquiry). CFPs must adhere to the fiduciary standard.

CPA Personal Financial Specialist (PFS): The American Institute of CPAs® offers a separate financial planning designation. In addition to already being a licensed CPA, a CPA/PFS candidate must earn a minimum of 75 hours of personal financial planning education and have two years of full-time business or teaching experience (or 3,000 hours equivalent) in personal financial planning, all within the five year period preceding the date of the PFS application. They must also pass an approved Personal Financial Planner exam.

Membership in the National Association of Personal Financial Advisors (NAPFA): NAPFA professionals must be RIAs and must also have either the CFP or CPA-PFS designation. Additionally, NAPFA advisers are fee-only, which means that they do not accept commissions or any additional fees from outside sources for the recommendations they make. In addition to being fee-only, NAPFA advisers must provide information on their background, experience, education and credentials, and are required to submit a financial plan to a peer review. After acceptance into NAPFA, members must fulfill continuing education requirements.

For the original article found on LinkedIn, click here.

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BOSTON, Aug. 27, 2014 /PRNewswire/ — Rhythm, a biopharmaceutical company developing peptide therapeutics that address gastrointestinal diseases and genetic deficiencies that result in metabolic disorders, announced today that it has filed a registration statement on Form S-1 with the U.S. Securities and Exchange Commission (SEC) relating to the proposed initial public offering of shares of its common stock. The number of shares to be offered and the price range for the offering have not yet been determined.

Citigroup and Cowen and Company will act as joint book-running managers for the offering. Canaccord Genuity Inc., Oppenheimer & Co., and Cantor Fitzgerald & Co. will act as co-managers. The offering will be made only by means of a prospectus. When available, copies of the preliminary prospectus relating to the offering may be obtained from Citigroup, c/o Broadridge Financial Solutions, 1155 Long Island Avenue, Edgewood, New York 11717, or by email atprospectus@citi.com, or by calling (800) 831-9146, and from Cowen and Company, c/o Broadridge Financial Solutions, 1155 Long Island Avenue, Edgewood, New York 11717, or by calling (631) 274-2806, or by fax at (631) 254-7140.

A registration statement relating to these securities has been filed with the SEC, but has not yet become effective. These securities may not be sold, nor may offers to buy be accepted, prior to the time the registration statement becomes effective. This press release shall not constitute an offer to sell or a solicitation of an offer to buy these securities, nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful, prior to registration or qualification under the securities laws of any such state or jurisdiction.

Rhythm is a biopharmaceutical company developing peptide therapeutics that address unmet needs in gastrointestinal diseases and genetic deficiencies that result in metabolic disorders. Rhythm is developing the ghrelin peptide agonist, relamorelin (RM-131), for the treatment of diabetic gastroparesis and other gastrointestinal functional disorders; and the MC4R peptide agonist, RM-493, for obesity caused by genetic deficiencies in the MC4 pathway. The company is based in Boston, Massachusetts.

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