RJ and Makay

Now that it has clarified how broker dealers and RIAs can provide client information, the SEC has broadened CFP Board of Standard’s powers regarding violations of a privacy rule and potential SEC enforcement action.

Federal privacy rule Regulation SP has served as the rationale for why advisors were prevented from sharing client information with the Board during customer complaint proceedings.

A recent inquiry by Senators Carl Levin and Tom Coburn has yielded 19 recommendations to deal with high-risk lending, regulatory failures, inflated credit ratings, and investment bank abuses. The recommendations, published on April 13, are as follows.

High risk lending:

1. Ensure "Qualified Mortgages" Are Low Risk - Federal regulators should use their regulatory authority to ensure that all mortgages deemed to be "qualified residential mortgages" have a low risk of delinquency or default.
2. Require Meaningful Risk Retention - Federal regulators should issue a strong risk retention requirement under Section 941 by requiring the retention of not less than a 5% credit risk in each, or a representative sample of, an asset backed securitization's tranches, and by barring a hedging offset for a reasonable but limited period of time.

3. Safeguard Against High Risk Products - Federal banking regulators should safeguard taxpayer dollars by requiring banks with high risk structured finance products, including complex products with little or no reliable performance data, to meet conservative loss reserve, liquidity, and capital requirements.

The economy is poised to expand at its fastest pace in eight years because of brisk consumer and business spending, according to a new survey of 51 economists by the Wall Street Journal.

The economists predict gross domestic product (GDP) will be 3.5% higher in the fourth quarter of 2011 than a year earlier, a slight increase from the 3.3% they projected last month and, if it comes to pass, the largest increase since 2003. GDP is expected to grow at a 3.6% annual rate in the current quarter, a 0.4% increase from the final quarter of 2010.