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With several MSRB rules for municipal advisors effective in 2016, the MSRB reminds municipal advisors to make any necessary modifications to their written supervisory procedures and compliance policies.
For example, provisions for municipal advisors of MSRB Rule G-20 related to gift-giving became effective on May 6, 2016. Accordingly, a municipal advisor’s written supervisory procedures should now include procedures reasonably designed to avoid improprieties and conflicts of interest that may arise when regulated entities or their associated persons give gifts or gratuities in relation to the municipal advisory activities of the recipients’ employers. Written supervisory procedures should include a description of how the designated municipal advisor principal(s) will monitor and review the municipal advisory activities of associated persons for compliance with Rule G-20.
Since 2015, municipal advisors have been required under MSRB Rule G-44 to have supervisory procedures and compliance policies “reasonably designed to achieve compliance with all applicable rules” and since April 23 2016, to certify annually “processes to establish, maintain, review, test and modify written compliance policies and supervisory procedures.”
Core Rules and Effective Dates for Municipal Advisors
Duties of Non-Solicitor Municipal Advisors
Rule G-42 to establish the core standards of conduct and duties of municipal advisors when engaging in municipal advisory activities
Effective June 23, 2016
Political Contributions and Prohibitions on Municipal Securities Business and Municipal Advisory Business
Amended Rule G-37 to extend the core standards under Rule G-37 to municipal advisors, their political contributions and the provision of municipal advisory business
Effective August 17, 2016
Books and Records to be Made by Brokers, Dealers, and Municipal Securities Dealers and Municipal Advisors
Amended
Rule
G-8 to establish recordkeeping requirements
that apply when a municipal advisor makes a suitability determination or
reviews the recommendation of another party
Effective June 23, 2016
Additional amendments to Rule G-8 to impose the same
recordkeeping requirements related to political contributions by municipal
advisors and their associated persons that apply to dealers and their associated
persons
Effective August 17, 2016
Preservation of Records
Amended
Rule
G-9 to require municipal advisors to
preserve for six years the records required to be made concerning political contributions
Effective August 17, 2016
On May 31, 2016, the MSRB notified municipal advisors that the permanent Municipal Advisor Representative Qualification Examination (Series 50) will be available beginning September 12, 2016. As provided for under MSRB Rule G-3, municipal advisor representatives are required to take and pass the Series 50 in order to engage in municipal advisory activities. The score required to pass the Series 50 exam is 71 percent, and municipal advisors have until September 12, 2017 to take and pass the test.
 Beginning in
late June 2016, EMMA users will have free, convenient access to an
economic calendar with dates and descriptions of
key macroeconomic developments that could have an impact on the trading
and issuance of municipal securities. The calendar will highlight
federal data releases, events and other indicators of the health of
the overall economy, such as labor statistics and interest rate decisions.
Municipal securities issuers, investors and their financial professionals may
want to consult the economic calendar when assessing market activity. The
MSRB is adding the calendar to the tools
and resources currently available on EMMA to help investors and
issuers make decisions that are right for them.
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