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SEC task force to identify fraud via analytics

Regulatory/Compliance

An SEC enforcement task force will use data analytics to uncover issues that occur when clients work with advisors and to identify potential solutions, according to InvestmentNews. An SEC official said the analytics will be used to look for widespread problems regarding fee disclosure and unsuitable product recommendations, the publication reports. Read the full story below. Also, The Securities Litigation & Consulting Group has published a white paper that ranks the “worst brokerage firms” in the securities industry by their complaint histories, Financial Advisor reports. SLCG’s findings, called “first-of-its-kind research,” are culled from information from Finra’s own BrokerCheck data from 2007 to 2016, the publication states. Read the details below.

SEC task force targets retail investor fraud at the adviser level

New division will go after problems such as fee disclosure and unsuitable products

By Mark Schoeff Jr.

A new Securities and Exchange Commission enforcement initiative will target retail investor harm that occurs when clients work with investment advisers, an SEC official said on Thursday. Stephanie Avakian, co-director of the SEC Division of Enforcement, said that the agency’s retail strategy task force will use data analytics to find widespread problems involving inadequate fee disclosure and unsuitable product recommendations. It will parse data about products, types of fees and investors, advisory office locations and sales practices. In addition to market data, it will draw on the thousands of tips, complaints and referrals that come into the SEC as well as findings from adviser examinations.

http://www.investmentnews.com/article/20171026/FREE/171029952/sec-task-force-targets-retail-investor-fraud-at-the-adviser-level

Firm Does What Finra Won’t: Rates 30 Worst Brokerage Firms

By Tracey Longo

Source: Financial Advisor

The Securities Litigation & Consulting Group (SLCG) has done what regulators have repeatedly declined to do — published the worst ranked brokerage firms in the securities industry. “What we found is the worst brokerage firms over the past 10 years which are still in business remain the worst firms,” said Craig McCann, CFA, PhD, and founder of SLCG, said in the firm’s white paper “Rating Brokerage Firms by Their Complaint Histories Rather Than by Their Brokers’ Histories.”

https://www.fa-mag.com/news/firm-does-what-finra-won-t–publicly-rates-30-worst-brokerage-firms-based-on-brokercheck-35353.html

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