More On Legal & Compliancefrom The Advisor's Professional Library
- Conducting Due Diligence of Sub-Advisors and Third-Party Advisors Engaging in due-diligence of sub-advisors isnt just a recommended best practice it is part of the fiduciary obligation to a client. An RIA should be extremely reluctant to enter a relationship with a sub-advisor who claims the firms strategy is proprietary.
- Preventing and Dealing with Client Complaints Although the SEC has not provided specific guidance on how client complaints should be handled, a firms policies and procedures should provide clear direction how to do so, as neglecting complaints can exacerbate a bad situation.
The Securities and Exchange Commission (SEC) announced Friday that Thomas J. Butler has been appointed director of the agency’s new Office of Credit Ratings.
The office was created by the Dodd-Frank Wall Street Reform and Consumer Protection Act and is responsible for overseeing the nine registered Nationally Recognized Statistical Rating Organizations (NRSROs).
Among the responsibilities of the new office is conducting an annual exam of each credit rating agency and issuing a public report. Prior to the creation of the Office of Credit Ratings, the NRSRO examinations required under Dodd-Frank were conducted by the SEC’s Office of Compliance Inspections and Examinations (OCIE).
The SEC says Butler, who starts on June 18, will oversee a staff of approximately 25 lawyers, accountants and examiners responsible for examining and monitoring the NRSROs.
“Tom’s background and experience will bolster the agency’s oversight and review of credit rating agencies,” said SEC Chairman Mary Schapiro in a statement.
Throughout his career, Butler has served in leadership positions through which he gained extensive knowledge about the role of credit rating agencies in the financial services sector. He spent 14 years at Morgan Stanley Smith Barney and its predecessors, including Citi Global Wealth Management, where he held senior executive positions for several business units, including as a managing director and chief operating officer for the Investment Strategy, Investment Advisory, Global Investments and Public Sector Group units.
Earlier in his career, Butler worked at UBS Securities, Babcock & Brown and two major law firms. He received his J.D. from Rutgers University School of Law at Newark and his B.A. from Rutgers College.