Wednesday, January 06, 2010


Many Advisors Not Subject To Audits

Independent registered investment advisors have good reason to applaud the Securities and Exchange Commission's approval of a final version of its "Madoff fix" a few weeks ago. For one thing, the rule, which calls for investment advisors to undergo annual surprise audits, could be helpful in stemming the kind of malfeasance imprisoned con artist Bernard Madoff has come to represent.

"The SEC is trying to put in place controls to protect investors from fraudsters," says Brian Stimpfl, head of advisor advocacy and industry affairs at TD Ameritrade's Institutional division, which provides custody and other support services to about 4,000 RIAs. "Rocks were overturned in the last year, and as an industry we really didn't like what we saw under those rocks."

But only SEC-registered investment advisories that custody assets in house—as Madoff's firm did—are subject to the rule...

FA-Mag: Many Advisors Not Subject To Audits

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