The Dodd-Frank Act is critical in strengthening the financial system and preventing another crisis, Federal Reserve Chair Janet Yellen said. While there is room for improvement in reducing the regulatory burden for small banks, the law should not be dismantled, she said.
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The Financial Stability Board has made 14 recommendations for dealing with risks associated with the asset-management sector. "The policy recommendations will better prepare asset managers and funds for future stress events," said Daniel Tarullo, chairman of a committee on supervisory and regulatory cooperation.
The Securities and Exchange Commission has added firms providing "electronic investment advice" to its list of examination priorities for 2017. It is the first time registered investment advisers and broker-dealers offering online advice, typically called robo-advisers, have appeared on the list.
The rise of online banking has led to an increase in financial data aggregation and questions about security as aggregators move data among bank websites using usernames and passwords, which increases hacking vulnerability. Solutions in the works include electronic tokenization used in combination with dedicated data channels.
Financial planning firms should ask their millennial employees to come up with a service model that uses online advice platforms and relies on fees as opposed to commissions, Bob Veres writes. "I've talked with hundreds of advisers who switched from commissions to fees, and they all, in one way or another, told me that it was like a lightbulb going off," he writes.
The House has passed a bill that would impose new restrictions on rule making by the Securities and Exchange Commission and would require the SEC to review existing regulations every five years. The bill sets out specific requirements for the cost-benefit analysis required before regulations are adopted.
President-elect Donald Trump reportedly met this week with former Rep. Randy Neugebauer, R-Texas, who is said to be a contender for the Consumer Financial Protection Bureau's top position. While in Congress, Neugebauer initiated legislation to shift control of the agency from one director to a five-member bipartisan panel.
Financial companies are scrambling to request patents on blockchain intellectual property, showing the significance of the emerging technology. However, few patents have been issued, highlighting challenges in appropriating what began as open-source software.