Drinker Biddle Launches Best Interest Compliance Team
October 3, 2018 by Melanie Waddell
Drinker Biddle & Reath recently launched a Best Interest Compliance Team to help broker-dealers and advisors navigate the “stream of rules and regulations” that have been floated relating to their standards of care and management of conflicts.
“The need for experienced counsel to help navigate the evolving and overlapping federal and state ‘best interest’ obligations has increased,” the law firm said in announcing the team of more than 20 lawyers with experience in investment management, ERISA, SEC & regulatory enforcement defense, Llitigation/FINRA arbitration, and insurance regulatory and transactional practice areas.
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Drinker Biddle says its Best Interest Compliance Team will help clients make decisions about questions on the Securities and Exchange Commission’s yet-to-be-finalized Regulation Best Interest for brokers, as well as the SEC’s RIA interpretive guidance and how it impacts the standards currently applied to RIAs.
Fred Reish, partner at Drinker Biddle & Reath, told ThinkAdvisor Wednesday that the law firm created the team “to reflect the evolving needs of our financial services clients.”
Since Labor’s first fiduciary proposal was issued 10 years ago, Drinker Biddle’s “FINRA, securities, insurance and investment management attorneys needed to work together closely to provide guidance on our overlapping legal expertise and practical knowledge,” Reish explained.
For instance, “our ERISA attorneys needed to coordinate our fiduciary and prohibited transaction knowledge with the FINRA attorneys’ regulatory expertise and practical knowledge of the operations of broker-dealers.”
Now the SEC and several states have “increased or proposed to increase their standards of care to a best interest/fiduciary standard,” he continued.
“It was no longer practical for our practices to be siloed into single areas of legal expertise. We need to combine our knowledge to best serve our clients.”
Jim Lundy, partner at Drinker Biddle & Reath, added that SEC Chairman Jay Clayton “has made the proposed Reg BI and the related proposals … one of the main priorities of his chairmanship.”
Clayton’s recent public statements show he “is continuing to utilize [his] power … to move these initiatives forward.”
Other topics include help in deciphering what the effect of the court order vacating the Labor Department’s fiduciary rule means and which already-implemented changes will continue under the SEC proposals for RIAs and broker-dealers.
Also, the best-interest team will provide guidance on measures that should be taken to show good-faith compliance with the DOL’s non-enforcement policy.
