“We believe that the June 30, 2020 compliance date for Reg BI and other requirements, including the requirement to file and begin delivering Form CRS, remains appropriate,” Clayton said.
“Over the past 10 months, the Commission and the staff have engaged extensively with broker-dealers, investment advisers, retail investors and other market participants, as well as FINRA and other regulatory partners, regarding the implementation of Reg BI and Form CRS,” he explained.
“We believe firms with account relationships comprising a substantial majority of retail investor assets have made considerable progress in adjusting their business practices, supplementing and modifying their policies and procedures, and otherwise aligning their operations and preparing for the requirements of Reg BI and the obligation to file and begin delivering Form CRS,” added Clayton.
As the coronavirus pandemic has threatened employers’ business continuity models across the economy, including within the financial services industry, speculation emerged that the deadline for Reg BI, the new standard of conduct requirement for broker-dealers serving retail investors, would be delayed.
Clayton did suggest some compliance latitude for firms struggling under the effects of COVID-19′s impact on the economy.
“Firms should continue to make good faith efforts around operational matters to ensure compliance by June 30, 2020, including devoting resources as necessary and available in light of the circumstances,” said Clayton.
“To the extent that a firm is unable to make certain filings or meet other requirements because of disruptions caused by COVID-19, including as a result of efforts to comply with national, state or local health and safety directives and guidance, the firm should engage with us,” he said.
“I expect that the Commission and the staff will take the firm-specific effects of such unforeseen circumstances (and related operational constraints and resource needs) into account in our examination and enforcement efforts,” he added.