Dramatic growth of a retail trading app and its acceleration of risky retail transactions appears to have set off alarms at financial regulators, as well as members of Congress. BARRON’S reached out to FrontLine’s Founder and President Amy Lynch to discuss Robinhood, the trading app company, and how the SEC and other regulators would approach an inquiry. Ms. Lynch explains that both the appearance and technology of the app would require a review, as well…
The Office of Compliance Inspections and Examinations (OCIE) recently issued a Risk Alert (the “Alert”) regarding its findings and observations during the COVID-19 pandemic. The Alert pertains to both SEC registered investment advisers and broker-dealers and covers the SEC’s interactions with firms, investors, and the general public since March of this year.
The primary categories addressed within the Alert are:
Asset protection
Employee supervision
Fees, expenses, and transaction practices
Business Continuity practices
Data security and…
Regulators likely see the proliferation of the Robinhood trading app usage as having the all too telling signs of day trading. Amy Lynch, Founder and President of FrontLine Compliance, sees this as a concerning trend that typically becomes very costly to individual investors. Ms. Lynch points out that the timing of markets is often a losing game, with day traders having a gamer’s or gambling mentality, It’s easy to see the appeal for younger people,…
Video: “SEC to Private Funds: Prepare for an Exam”
On June 23, 2020, the SEC’s Office of Compliance Inspections and Examinations (OCIE) issued a Risk Alert (the “Alert”) discussing observations from its private fund examinations over time. The Alert did not state the time period of the examinations included. However, any private fund manager that has been examined within the past two years should recognize some of the topics discussed.
The Staff covers three main…
While the SEC has been critical of certain firm information on Form CRS that it has reviewed, the regulator has not offered additional guidance to firms to help them better decipher the content required. FrontLine’s Founder and President says that needs to change. Ms. Lynch states that by strictly following the SEC’s suggested format, Form CRS becomes just a disclosure document that would not offer the meaningful information for clients as it was intended. She…
