NAICU Washington Update

SEC Proposes New Requirements for Municipal Advisors

February 11, 2011

In January, the Securities and Exchange Commission proposed rules that, among other things, would require people who fit the broad definition of "municipal advisor" to register with the SEC, and comply with new record-keeping requirements.  Certain employees, board members, and trustees of both private and public colleges may be subject to this new requirement, if the rules are implemented.

The proposal is part of the ongoing implementation of the Dodd-Frank Wall Street Reform and Consumer Protection Act, signed into law last July. The provisions in the bill are considered the most sweeping changes to financial regulation in the U.S. since the Great Depression.

Municipal advisors are generally defined in the law as those who provides financial advice on municipal financial products, or the issuance of municipal financial securities - including advice on the structure, timing, terms, and other similar financial matters.  There are exceptions to the definition, including different requirements for employees of public colleges and universities, and employees and board members of private institutions.

The higher education community is preparing comments on the proposed rule for submission to the SEC. The Association of Governing Boards of Colleges and Universities (AGB) will address the concerns of all public and private institution trustees and affiliated board members. The American Council on Education (ACE) is drafting comments on presidents, CFOs, and other college and university employees potentially impacted by the proposal. Both letters will be circulated for association signatures.

The SEC had originally requested that comments be submitted by February 22, but it's possible that date could be extended.  Those interested in submitting comments will find the proposal and details on submissions in the Federal Register

MORE News from NAICU