MSRB Municipal Advisor Review - Fall 2017

Municipal Securities Rulemaking Board sent this bulletin at 09/20/2017 09:21 AM EDT

NOTE: This is the final edition of the Municipal Advisor Review. In the coming months, the MSRB will begin publication of Compliance Corner, a quarterly electronic newsletter addressing the compliance obligations of municipal advisors and municipal securities dealers. Compliance Corner will provide regulatory updates and resources to facilitate understanding of MSRB rules.

Focus on Fair and Equitable Fees

The MSRB’s long-term strategic goals include a focus on financial sustainability. In 2015, the MSRB conducted a holistic review of the organization’s funding sources, which is informing efforts to more equitably assess fees among regulated entities. When the first changes stemming from that review were approved in 2015, the municipal advisor professional fee under MSRB Rule A-11 was not increased in order to allow municipal advisors time to adapt to regulation. The MSRB noted at the time, however, that it would revisit the amount of the fee in light of the substantial costs associated with developing and maintaining a regulatory regime for municipal advisors. The MSRB plans to soon propose an increase to the municipal advisor professional fee to preserve the organization’s ability to fulfill its Congressionally mandated mission and its commitment to fairly and equitably allocate costs among regulated entities.

Upcoming Webinar

Continuing Education Requirements for
Municipal Advisors
During this free webinar, MSRB staff will review amended MSRB Rule G-3, which requires municipal advisors to develop and implement a continuing education program by January 1, 2018. The webinar will take place on October 12, 2017 from 3:00 p.m. - 4:00 p.m. ET. Register for the webinar.

Upcoming Job Survey for Municipal Advisor Principals

As the MSRB develops a qualification exam for municipal advisor principals, we need your input! The MSRB will email a survey to municipal advisors this fall to collect information on the job functions of municipal advisor principals. Responses from a diverse set of municipal advisor firms will help refine the content covered by the exam.

All Municipal Advisors Must Be
Series 50-Qualified

As of September 12, 2017, only those municipal advisor professionals who have passed the Municipal Advisor Representative Qualification Examination (Series 50) are permitted to engage in municipal advisory activities on behalf of their firms. The MSRB reminds municipal advisor firms that permitting an associated person without the Series 50 qualification to engage in municipal advisory activities on the firm’s behalf after this date could be a violation of MSRB rules and other federal securities laws.

The MSRB is encouraging municipal securities issuers to visit the MSRB’s website to view a list of MSRB-registered municipal advisor firms and the names of their Series 50-qualified professionals. Firms that do not have at least one Series 50-qualified professional no longer appear on the MSRB’s list of municipal advisor firms.

Additional information about the Series 50 exam and steps for firms to take to ensure compliance with registration and qualification requirements is available in updated FAQs on the MSRB’s website.

Compliance Advisory for
Municipal Advisors

The MSRB recently published its annual Compliance Advisory for Municipal Advisors, part of the MSRB’s ongoing effort to assist municipal advisors with understanding MSRB rules and identifying potential compliance risks. Proactively addressing compliance risks benefits municipal advisors, their municipal entity and obligated person clients and, ultimately, investors and public confidence in the municipal securities market.

MuniEdPro® Course Reviews Rule G-42

Municipal advisors can enhance their knowledge of compliance obligations under MSRB Rule G-42 with the latest MuniEdPro® course, "Standards of Conduct: The Duties of Non-Solicitor Municipal Advisors." The course depicts real-world scenarios when providing advice with respect to municipal financial products or the issuance of municipal securities. Log into MuniEdPro® today and challenge yourself to make informed choices in compliance with Rule G-42.

For more information about how MuniEdPro® can augment your firm's continuing education compliance program, contact Ritta McLaughlin at rmclaughlin@msrb.org or 202-838-1306.

Implementing Municipal Advisory Client Education and Protection Rules

Effective October 13, 2017, amendments to MSRB Rule G-10 on investor and municipal advisory client education and protection rules will require municipal advisors to provide municipal entity clients with annual written notification of the advisor’s registration status, the MSRB’s website address and the availability of a brochure that describes regulatory protections for municipal entities and how to report a complaint against a municipal advisor to the appropriate authority. The upcoming amendments to Rule G-10 also require municipal advisors to maintain a log of municipal advisory complaints. The resources listed below can facilitate compliance with the new requirements:

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