The SEC’s Divisional Standards of Conduct Implementation Committee launched its review of Form CRS from a cross section of RIAs and BDs to assess compliance with the content and format requirements. Initial observations from the Committee have identified examples of relationship summaries that may lack certain disclosures or could be clearer or otherwise improved. The Committee also indicated the summaries reviewed to date generally reflect effort by firms to meet the content and format requirements, and have identified good examples of simple, clear disclosures.
The inter-Divisional Standards of Conduct Implementation Committee was established when Form CRS was adopted and includes representatives from the SEC’s Division of Investment Management, Division of Trading and Markets, Division of Economic and Risk Analysis, and Office of Compliance Inspections and Examinations.
The Committee will share best practices and provide feedback on the filings and is planning to host a roundtable this fall to share additional thoughts following the review of the initial filings.
The Committee stated, “Particular firms may need to consider ways to improve their relationship summaries and determine whether any specific amendments, or broader change in their overall approach, would be appropriate.”
CSS has also been reviewing compliance with the requirements by reviewing a sampling of public filings, utilizing its tools to identify where refinements are needed, and deficiencies exist. We will be publishing our own observations soon.
The SEC encouraged firms to continue to review and refine their relationship summaries, and familiarize themselves with the specific requirements of Form CRS by reviewing the Instructions to Form CRS, the Form CRS Adopting Release, the Frequently Asked Questions on Form CRS, and the Small Entity Compliance Guide.
For more information on CSS’s Form CRS Automator and Reg BI compliance services, please contact us at: FormCRS@cssregtech.com.
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