The leading knowledge platform for the financial technology industry
The leading knowledge platform for the financial technology industry

A-Team Insight Blogs

SEC Adopts Temporary Rule Requiring Municipal Advisors to Register With Agency

Share article

The Securities and Exchange Commission today announced that it has adopted a temporary rule requiring municipal advisors to register with the SEC by 1 October, a deadline established by the newly-enacted Dodd-Frank Wall Street Reform and Consumer Protection Act.

Municipal advisors provide advice to state and local governments and other borrowers involved in the issuance of municipal securities. The advice typically relates to municipal derivatives, guaranteed investment contracts, investment strategies or the issuance of municipal securities. Municipal advisors also solicit business from a state or local government for a third party.

Municipal advisors can now access and complete the new registration form (Form MA-T) on the SEC’s website. Municipal advisors are encouraged to begin the registration process as soon as possible because of the impending registration deadline and the requirement that applicants first obtain an ID and password.

“We have acted expeditiously to create a temporary registration system to gather key data and provide transparency about municipal advisors,” said SEC chairman Mary Schapiro. “As a result, regulators, investors, and state and local governments will have a much better understanding of those who provide services in the municipal market.”

The SEC implemented the registration provision on an interim basis in order for municipal advisors to meet the new law’s 1 October registration deadline. The SEC expects to propose a permanent rule later this year.

Information filed by municipal advisors will be made publicly available on the SEC’s website by the registration deadline.

Subject to certain exemptions, the definition of municipal advisor under the Dodd-Frank Act includes financial advisors, guaranteed investment contract brokers, third-party marketers, placement agents, solicitors, finders, and certain swap advisors that provide municipal advisory services.

Form MA-T requires municipal advisors to provide identifying and contact information, and select from a list of municipal advisory activities in which they engage. Municipal advisors also are required to provide disciplinary history information similar to what the SEC obtains from registered broker-dealers and investment advisers. Municipal advisors will be required to amend the form whenever any identifying and contact information or disciplinary information has become inaccurate in any way, and whenever a municipal advisor wishes to withdraw from temporary registration.

This regulation is the first adopted by the SEC to implement the requirements of the Dodd-Frank Act.

The Commission and its staff have already taken several other actions stemming from the new law, including seeking public comment regarding the ongoing study of the obligations of brokers, dealers, and investment advisers; issuing guidance interpreting how the “value of the primary residence” should be determined for purposes of calculating an investor’s net worth; seeking public comment about various definitions in connection with over-the-counter derivatives; holding a staff roundtable, jointly with the CFTC staff, regarding the governance of clearing facilities and conflicts; and posting job announcements for many new positions required by the legislation, including 25 positions related to the new Office of Credit Ratings.

Related content

WEBINAR

Upcoming Webinar: Managing unstructured data and extracting value

Date: 3 December 2020 Time: 10:00am ET / 3:00pm London / 4:00pm CET Unstructured data offers untapped potential but the platforms, tools and technologies to support it are nascent, often deployed for a specific problem with little reuse of common technologies from application to application. What are the challenges of managing and analysing this data and...

BLOG

UK Opts Out of CSDR Buy-in, SFTR Reporting

In a written statement outlining a series of regulatory reforms planned for the UK, Chancellor Rishi Sunak confirmed last week that the UK will not include the Central Securities Depositories Regulation’s (CSDR) settlement discipline regime as part of its adoption of EU regulations post Brexit. Instead, UK firms should “continue to apply the existing industry-led...

EVENT

RegTech Summit Virtual

The RegTech Summit Virtual which took place in June 2020 was a huge success with over 1,100 delegates registered. We are currently working on our plans for 2021 and we hope to be back with an in-person event. Whatever the future holds you can guarantee our 2021 event will be back with an exceptional guest speaker line up of Regtech practitioners, regulators, start-ups and solution providers to collaborate and discuss innovative and effective approaches for building a better regulatory environment. Can't wait until 2021? make sure you sign up to our RegTech Summit Virtual, November 2020. More info...

GUIDE

Entity Data Management Handbook – Sixth Edition

High-profile and punitive penalties handed out to large financial institutions for non-compliance with Anti-Money Laundering (AML) and Know Your Customer (KYC) regulations have catapulted entity data management up the business agenda. So, too, have industry and government reports on the staggering sums of money laundered on a global basis. Less apparent, but equally important, are...