The Securities and Exchange Commission warned Monday that broker-dealers are using outdated systems to ensure Regulation Best Interest compliance, which has resulted in violations in areas like rollover and account recommendations.
In a just-released Risk Alert, the agency's exam division points to several compliance deficiencies the agency has found during exams.
After Reg BI's June 30, 2020, compliance date, the Division of Examinations started conducting broker-dealer exams to assess compliance with the rule.
Moving forward, the Risk Alert states, the exam division intends to incorporate compliance with Reg BI "into retail-focused examinations of broker-dealers, particularly those that include sales practices within the scope of the examination."
The risk alert highlights deficiencies noted during exams, as well as examples of weak practices that could result in deficiencies, the SEC explains.