The SEC Updates Form CRS FAQ

October 12th | 2020

The SEC recently updated its Form CRS FAQ to include additional answers. As you may recall, Reg. BI and Form CRS are part of the SEC’s new package of rules and interpretations regarding the standard of conduct applicable to broker-dealers providing retail investment advice and the fiduciary duty applicable to SEC-registered investment advisers. The new rule went into effect this summer and this FAQ update follows a few months of experience the industry now has with the new requirements.

The new FAQs center around the requirement to disclose details about a firm’s and its employees’ disciplinary history. The FAQs make it clear that that section is required even if there is nothing to report. Further, the SEC clarifies that at high level a distinction between the firm’s disciplinary history and its employees may be appropriate, but also adds that it would not be appropriate to add descriptive or other qualitative or quantitative language. This makes sense, as Form CRS is intended to provide useful, “at a glance” information.

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