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Pershing Launches New Resources to Help Firms Comply With DOL

In addition to upgrading its technology for advisors, Pershing also made the Department of Labor’s fiduciary rule, and the impact it will have on the industry, a primary focus of its 18th annual INSITE conference this week in Orlando, Fla. 

Pershing announced a handful of new programs and resources to help financial services firms comply with the new regulation. Rob Cirrotti, the managing director and head of retirement and investment solutions at Pershing, said his company has been developing the solutions over the past 18 months while working with firms to help them understand the conflict of interest rule.

“We’ve identified various needs that have emerged as a result of the new rule and have been working to develop solutions to help our clients achieve success in this regulatory environment,” Cirrotti said. He added that while the final version of the rule isn’t as disruptive as the initial proposal, it could still fundamentally change a firm’s operating models, compensation arrangements and supervisory structures. “The combination of our new and existing tools helps our clients operate as fiduciaries.”

To help registered reps make the switch from the commission-based brokerage model to fee-based business, Pershing is launching new mutual fund and ETF products designed to serve emerging and mass affluent investors. The company also announced that it plans to roll out third-party tools to facilitate conversations between registered reps and their clients as they transition accounts.

One of the most debated aspects of the DOL rule is the Best Interest Contract (BIC) exemption, which allows firms and advisors to be compensated if certain conditions are met. To help firms adapt and navigate the nuances of the BIC exemption, Pershing is developing tools that facilitate compliance throughout the entire transaction, such as creating contracts and disclosures through record keeping. Pershing said it would also launch programs that help broker/dealers manage contracts and disclosures.

Firms also expect a greater need for surveillance and supervision to remain compliant, as well as documented evidence. Cirrotti said Pershing is in the process of creating reporting packages and workflows for firms to ensure their advisors are compliant, and that it plans to enhance firms’ capabilities of supervising assets on their platform. 

TAGS: Industry
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