Simplify Your RegBI Compliance

The Broker-Dealer, prior to or at the time of the recommendation, provides the retail customer, in writing, full and fair disclosure of:

• All material facts relating to the scope and terms of the relationship with the retail customer, including:
  • That the Broker-Dealer is acting as a broker, dealer, or an associated person of a broker or dealer with respect to the recommendation;
  • The material fees and costs that apply to the retail customer’s transactions, holdings, and accounts;
  • The type and scope of services provided to the retail customer, including any material limitations on the securities or investment strategies involving securities that may be recommended.
• All material facts relating to conflicts of interest that are associated with the recommendation.

The Broker-Dealer, in making the recommendation, exercises reasonable diligence, care, and skill to:

• Understand the potential risks, rewards, and costs associated with the recommendation, and have a reasonable basis to believe that the recommendation could be in the best interest of at least some retail customers;
• Have a reasonable basis to believe that the recommendation is in the best interest of a particular retail customer based on that retail customer’s investment profile and the potential risks, rewards, and costs associated with the recommendation;
• Have a reasonable basis to believe that a series of recommended transactions, even if in the retail customer’s best interest when viewed in isolation, is not excessive and is in the retail customer’s best interest when taken together.

The Broker-Dealer establishes, maintains, and enforces written policies and procedures reasonably designed to:

• Identify and at a minimum disclose or eliminate, all conflicts of interest associated with such recommendations;
• Identify and mitigate any conflicts of interest associated with such recommendations that create an incentive for a natural person who is an associated person of a broker or dealer to place the interest of the Broker-Dealer ahead of the interest of the retail customer;
• Identify and disclose any material limitations placed on the securities or investment strategies involving securities that may be recommended to a retail customer and any conflicts of interest associated with such limitations;
• Prevent such limitations and associated conflicts of interest from causing the Broker-Dealer to make recommendations that place the interest of the Broker-Dealer ahead of the interest of the retail customer;
• Identify and eliminate any sales contests, sales quotas, bonuses, and non-cash compensation that are based on the sales of specific securities or specific types of securities within a limited period of time.