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B. G., Opalesque Geneva: Over the past week, several registered investment advisers (RIAs) have received examination letters from the Securities and Exchange Commission (SEC) regarding the transition to a T+1 settlement cycle.
The T+1 rules, effective from May 2024, require broker-dealers to ensure securities transactions are settled by the next business day (T+1), reports law firm K&L Gates. They also mandate the adoption of policies and procedures to facilitate the allocation, confirmation, and affirmation (ACA) process on the trade date (T). Additionally, recordkeeping rules for RIAs have been updated to include retention of communications related to the ACA process.
The SEC's examination letters request detailed information from RIAs regarding their procedures for trade affirmation and recordkeeping related to the T+1 settlement process. The specific documents requested include:
• Written compliance and operational policies related to the T+1 settlement and ACA process.
• Assessments or tests conducted on the ACA process, including risk and conflict listings.
• Compliance testing of the ACA process.
• Automated compliance tools associated with the ACA process.
• Compliance training related to the ACA process.
• Compliance exceptions regarding the ACA process.
• Communications with clients about the ACA process.
Additionally, the letters request information unrelated to the T+1 tra...................... To view our full article Click here
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