With a new presidential administration in place, financial firms could see a friendlier regulatory environment – but they should still stay on their toes, according to a new report from Deloitte.
A new paper from the firm highlights several areas of scrutiny for wealth management firms, including fiduciary duty, electronic communications compliance, and marketing practices under existing Securities and Exchange Commission rules.
"With the reelection of President Trump to a second, nonconsecutive term, financial regulatory policy is likely to reverse course for the second time in eight years," the report said, highlighting Trump's campaign pledge to “eliminate a minimum of ten old regulations for every one new regulation.”
Despite the expected shift in regulatory priorities, it said firms should still be mindful of the SEC's statement of priorities for 2025, which made it clear that fiduciary obligations, cybersecurity risks, and artificial intelligence will remain top concerns.
The agency’s enforcement has also intensified in recent years, particularly in the monitoring and retention of electronic communications. While initial actions targeted broker-dealers at large financial institutions, RIAs have increasingly faced scrutiny.
Deloitte’s report noted that regulators are not solely focused on off-channel communications – most recently in January, the SEC meted out a combined $63.1 million in penalties against a dozen firms including Blackstone, Schwab, and Apollo – but also on firms' ability to preserve records, which plays a key role in regulatory oversight. The agency has emphasized that inadequate recordkeeping could hinder its ability to supervise firms effectively and could expose broader compliance failures during investigations.
"In the new administration, however, we can expect sweeps for electronic communications violations and the attendant fines for such violations to abate," the report said.
Another key regulatory issue for RIAs is compliance with the SEC’s 2020 marketing rule. Enforcement efforts have concentrated on whether firms have written policies and employee training to prevent misleading statements in advertisements. The rule applies to all communications with potential clients, including those on social media, and requires disclosures around testimonials, endorsements, and third-party ratings. Firms must also ensure performance data presented in marketing materials is properly substantiated.
Regulators are also expected to keep a close eye on fiduciary compliance, particularly in how RIAs manage conflicts of interest, provide client recommendations, and determine account selection between brokerage and advisory services. The SEC has drawn parallels between fiduciary requirements and Regulation Best Interest, reinforcing that firms must prioritize client interests and disclose or eliminate conflicts where necessary.
"The spotlight is on, and if only one thing is crystal clear, it is that regulators are sending a strong message to those offering advice and managing client money: Do the right thing, because we’re watching you," Deloitte said.
Merrill's latest hires span Colorado to Louisiana, even as industry-wide recruiting data suggests the firm is losing almost as many advisors as it gains.
The $36 million buy allegedly hid inflated books and a $50 million diversion.
“An award citing emotional distress is very unusual,” an industry executive said.
New EBRI research found workers who participated in employer financial education reported higher confidence, literacy and financial satisfaction.
Beyond operational excellence, the winning advisors of the future are the ones who can reach across multiple disciplines without discarding specialist skills.
Northern Trust’s Ken Lassner shows advisors how to convert volatility into after-tax portfolio gains
Dan Biagini of American Equity says the steady decline of pensions, longer lifespans and a reset in interest rates are rewriting how advisors build retirement income
