{"id":5236,"date":"2011-10-16T00:00:00","date_gmt":"2011-10-16T05:00:00","guid":{"rendered":"https:\/\/institutionalinvestorsecuritiesblog.blawgcloud.com\/2011\/10\/sifma_offers_up_best_practices"},"modified":"2022-03-09T16:09:02","modified_gmt":"2022-03-09T22:09:02","slug":"sifma-offers-up-best-practices","status":"publish","type":"post","link":"https:\/\/www.investorlawyers.com\/blog\/sifma-offers-up-best-practices\/","title":{"rendered":"SIFMA Offers Up Best Practices for How Financial Firms Can Interact with Expert Networks"},"content":{"rendered":"<p>The Securities Industry and Financial Markets Association is recommending a number of best practices for financial firms that work with Expert Networks and their Consultants.<br \/>\nAccording to SIFMA, expert networks are entities that receive a fee to refer industry professionals, known as consultants, to third parties.  Although the acknowledges how helpful these networks can be in helping broker-dealers implement and design investment strategies while offering advice, information, market expertise, analysis, or other expertise in making investment decisions, SIFMA General Counsel Ira Hammerman said in a release that these best practices should help with compliance while helping avoid what could like \u201cimpropriety.\u201d The government has recently targeted them when investigating insider trading.<\/p>\n<p><em>Among the recommendations:<\/em><br \/>\n1)\tEstablishing policies and procedures for how to use Expert Networks and Consultants.  SIFMA is recommending a risk-based approach for figuring out what controls should be put in place. <\/p>\n<p>2)\tProviding training for associated persons that deal with Expert Networks and Consultants on matters such as insider training, information barriers, confidential information, conflicts of interest, or material, non-public information (MNPI).<\/p>\n<p>3)\tEnsuring that supervisory oversight is integrated into a financial firm\u2019s use of Expert Networks and associated consultants. <\/p>\n<p>4)\tSetting up policies and procedure that mandate that financial firms act quickly on \u201cred flags\u201d that may indicate there is a possibility of disclosure of confidential information of conflicts of interest or MNPI.<\/p>\n<p>5)\tEstablishing written agreements with Expert Networks over arrangements that are substantial or repeating in nature, such as those involving making sure that Consultants are checked for securities law violations, preventing Consultants from revealing MNPI or Confidential Information, requiring that Consultants undergo periodic training or communication about certain restrictions, and requiring that Consultants are periodically certified as to the adherence of these limits.<\/p>\n<p>6)\tSetting up procedures on how to advice Expert Networks-affiliated Consultants about Confidential Information and MNPI.<\/p>\n<p>7)\tEstablishing procedures for getting non-confidential, relevant information from an Expert Network or one of its Consultants about employment and arrangements where a Consultant may have access to Confidential Information or MNPI, as well as setting up appropriate controls for assessing risks of dealing with Consultants that work with Expert Networks that have Confidential Information or MNPI.  <\/p>\n<p>In providing these best practices, however, SIFMA wants to make clear that these are only intended as guidance and are not mandates for how financial firms must work with Expert Networks and Consultants. <\/p>\n<p>If you are an investor that has suffered losses you believe were caused by broker misconduct,  you should talk to a <a href=\"https:\/\/www.securities-fraud-attorneys.com\/\">securities fraud attorney<\/a> right away. <\/p>\n<p><a href=\"https:\/\/www.sifma.org\/uploadedfiles\/issues\/legal,_compliance_and_administration\/expert_networks\/expert-network-policy-bestpractices.pdf\">More on the SIFMA best practices<\/a>, SIFMA<\/p>\n<p>\n<strong>More Blog Posts:<\/strong><br \/>\nSEC and SIFMA Divided Over Whether Merrill Lynch Can Be Held Liable for Alleged ARS Market Manipulation, Institutional Investor Securities Blog, July 29, 2011<\/p>\n<p><a href=\"https:\/\/www.investorlawyers.com\/blog\/2011\/02\/commodities_industry_fears_bei\">Commodities Industry Fears being held to Regulatory Standards of Securities Industry<\/a>, Institutional Investor Securities Blog, February 4, 2011<\/p>\n<p><a href=\"https:\/\/www.investorlawyers.com\/blog\/2007\/05\/coleader_of_largest_securities_1\">Micah S. Green, Expected New CEO of Largest Securities Industry Group, Resigns During Scandal<\/a>, Stockbroker Fraud Blog, May 18 2007<\/p>\n<p> <a href=\"https:\/\/www.investorlawyers.com\/blog\/sifma-offers-up-best-practices\/#more-5236\" class=\"more-link\">Continue Reading \u203a<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>The Securities Industry and Financial Markets Association is recommending a number of best practices for financial firms that work with Expert Networks and their Consultants. According to SIFMA, expert networks are entities that receive a fee to refer industry professionals, known as consultants, to third parties. Although the acknowledges how helpful these networks can be [&hellip;]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[3752,3740],"tags":[],"class_list":["post-5236","post","type-post","status-publish","format-standard","hentry","category-financial-firms","category-miscellaneous"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.4 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>SIFMA Offers Up Best Practices for How Financial Firms Can Interact with Expert Networks &#8212; Investor Lawyers Blog &#8212; October 16, 2011<\/title>\n<meta name=\"description\" content=\"The Securities Industry and Financial Markets Association is recommending a number of best practices for financial firms that work with Expert Networks &#8212; October 16, 2011\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.investorlawyers.com\/blog\/sifma-offers-up-best-practices\/\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:title\" content=\"SIFMA Offers Up Best Practices for How Financial Firms Can Interact with Expert Networks &#8212; 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