TD Ameritrade launches website to spur adviser advocacy

First issue is to push for a way to increase RIA exams

Oct 6, 2015 @ 4:32 pm

By Mark Schoeff Jr.

A leading custodian is trying to get advisers on its platform — and others in the industry — more involved in lobbying Congress on behalf of registered investment advisers.

On Tuesday, TD Ameritrade Institutional launched a website designed to enable advisers easily to contact members of Congress to try to put adviser issues on their agenda.

A sample letter on the site that advisers can send to members of Congress highlights the low frequency of adviser exams by the Securities and Exchange Commission.

“What we're trying to do with this tool is to make our collective voices much louder,” said Skip Schweiss, TDAI managing director of adviser advocacy and industry affairs. “My hope is [advisers] would make two clicks and be heard.”

The form letter on the site does not promote a specific approach to strengthening oversight. It highlights the fact that the approximately 11,500 advisers registered with the SEC are examined about once every 11 years.

The document then outlines three ways to increase exams: outsourcing exams to a third party, sending more advisers to state oversight or allowing the SEC to collect user fees from advisers to fund exams.

RIAs would like to come up a way to increase exams that does not involve the Financial Industry Regulatory Authority Inc., the self-regulator for the brokerage industry. Finra has been talked about as a possible RIA examiner, but advisers don't like its rules-based approach to exams.

“A big part of our impetus for the letter is to go to our elected representatives and say, 'It's time to act,'” Mr. Schweiss said. “There's no perfect solution here. But we have to do something. We're trying to plant a seed.”

It may take a long time for the adviser-oversight tree to grow. Solutions that have been offered are not near fruition.

User-fee legislation was introduced in the previous Congress by Rep. Maxine Waters, D-Calif., ranking member of the House Financial Services Committee. It never received a hearing, and Ms. Waters has not reintroduced the bill in the new Congress.

SEC Chairwoman Mary Jo White has indicated that the SEC staff is working on a proposal for third party exams. It's not clear when it will be proposed.

The Republican-majority Congress has consistently denied the SEC the funding it says is necessary to hire the additional examination staff needed to boost adviser exams significantly.

“It's a big challenge,” Mr. Schweiss said. He added that the TD Ameritrade site is “taking the long view on the issue.”

The firm, which has 5,000 affiliated registered investment advisers, announced the site on Tuesday during its Advocacy Leadership Summit in Washington. Among other speakers, the event featured three former SEC chairmen.


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