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ARE YOU USING REG BI TO DRIVEGROWTH?

Discover the unexpected benefits of compliance.

REGULATION BEST INTEREST

REG BI: WHAT YOU NEED TO KNOWRegulation Best Interest (Reg BI), as mandated by the the Securities and ExchangeCommission (SEC), is designed to protect retail investors by increasing thetransparency and accountability of their wealth management advisory professionals. Here's what is expected of advisors under the new rule:

Broker-dealers must act in the best interest of their customers, and clearly identify any potential conflicts of interest and financial incentives with any of their investment recommendations. Registered Investment Advisors now have an enhanced fiduciary duty that includes a new level of care beyond suitability.

Whether you’re a broker-dealer, Registered Investment Adviser, or a dual-registrant,it's widely agreed that acting in a client’s best interest is the right thing to do. Reg BI is an opportunity to put what’s best for the client first and provide a newlevel of disclosure and transparency that extends beyond the existing suitabilitystandard.

FIVE OBLIGATIONS OF REG BI

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OBSTACLE OROPPORTUNITY:A d o p t a n e w a p p r o a c h t o c o m p l i a n c e .

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REG BI: IT'S TIME TO UP YOUR GAMEReg BI is forcing financial services firms to up their game when it comes totransparency, reporting, and client communication. Compliance is often viewed as a time-consuming burden. However, financialfirms that get out in front of the regulations and leverage them will create acompetitive advantage that can accelerate their growth. With the new Reg BI obligations, enterprises can’t afford any chance ofmiscalculating fees, providing unsuitable product recommendations, orexposing themselves to audit risks for non-compliance.

It’s crucial to implement technology solutions enabling advisors to documentthat Form CRS was delivered in real time, and that enterprises are acting in thebest interest of clients and fulfilling their duty of care obligations.

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REG BI: BUSINESS ADVANTAGES OF COMPLIANCE

Improving the quality of their systems and dataDeveloping a more competitive business modelEnhancing the overall client experience

In the past, firms that invested in meeting proposed regulations, such as theDOL’s Fiduciary Rule, have realized a number of advantages for theirbusinesses, including:

The good news is that many of the changes organizations are currentlyimplementing not only make sense from a regulatory perspective, but alsofrom a business perspective. And they are changes that are well worth doing. Rather than reluctantly complying with regulatory demands, firms who viewcompliance as an opportunity and focus on delivering exceptional clientexperience will be better positioned for growth.

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5 WAYS TO DRIVE GROWTHWITH REG BI

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LEVERAGE THEPOWER OFTRANSPARENCY TOBUILD TRUST

Transparent communication is at the core of exceptional clientexperience. It builds trust in the advisor/client relationship andincreases client satisfaction. In an era of parity products, increased fee transparency, and arange of investment choices available, it’s more crucial thanever for a financial firm’s long-term success to deliver arewarding and consistent client experience. Use Reg BI requirements to effectively disclose your fees andthe thinking behind your product recommendations, portfoliomanagement decisions, and conflict of interest resolutions. Once you disclose the fees your clients pay, rather than scaringthem off, trust and confidence levels actually go up. Nothing ishidden, and as a result, clients feel they’re seeing the wholepicture.

PRO TIPWhen advisors are transparent about the fees their clients pay, trust andconfidence levels increase.

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TIPS FOR FORM CRSEnsure that it’s easy-to-read andunderstandableUse simple language that relates to theaudienceClearly describe conflicts of interest andcompensation  Evaluate conflicts from the investor’sperspective

BE DELIBERATEABOUT FORM CRSDESIGN ANDWORKFLOW

The purpose of Reg BI’s Form CRS is to reduce investorconfusion about advisory and brokerage services and tohelp them decide who to establish an investment advisoryrelationship with. This mandatory disclosure form can be a handy tool toeducate and inform clients about your decisions and yourcommitment to serving their best interests. Implementingthe right digital solution can simplify the Form CRSprocess. It can automate your workflow to help you create a fullyconfigurable Form CRS on-demand with digital delivery,tracking and storage of dynamic content.

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TURN A DIFFICULTCONVERSATIONON ITS HEAD

“What do I get for the fees I pay? Why are you charging so much in fees/commissions?” Don’t dread the tough questions. Instead, use them to havetransparent and confident conversations about the value of youradvice. Use the documentation you compiled for Reg BI to demonstratehow you’re acting in a client’s best interest. The fee-basedmodel is gaining traction across the wealth managementindustry … and for good reason. Since this approach pays advisors on an ongoing basis, they canfocus on helping clients achieve their goals while alsomitigating potential conflicts of interest.

PRO TIPBe sure to train your advisors on how to talkabout fees so clients understand.

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EVOLVE FROMPRODUCT FOCUSTO CLIENT FOCUS

Rather than just talking about products, focus instead on aclient’s needs and goals. Advisors will be well served by doing a deep dive with clients touncover their priorities and concerns. By tying product recommendations and suitability assessmentsto the holistic advice they provide, advisors will not only fulfilltheir duty of care and conflict of interest obligations, they’ll alsocreate a more trusting relationship with their clients.

PRO TIPClients value conversations aboutachieving their goals more than productdetails.

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With the new Reg BI obligations, you can’t afford any chance ofmiscalculating your fees or providing an unsuitable productrecommendation.  Manual processing can expose your firm to errors andcompliance risk. By automating key processes, such as feemanagement, Form CRS delivery, product recommendations, andreporting, you can minimize your risk and ensure that you're onthe right side of your compliance obligations.  Derisk your operations by implementing a robust fees and billingsolution. With the right technology solution, you’ll not only beable to transparently calculate and report a wide range of fees,you’ll also create new revenue opportunities for your firm.

PRO TIPImplement robust wealthtech solutions toautomate your fee processing and revenuemanagement, and derisk your operations.

5 AUTOMATE KEYCOMPLIANCEPROCESSES

NO FRICTION. NO FUSS.Our wealthtech solutions help you comply with confidence.

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COMPLIANCE &OPERATIONS

Implement ta i lored r isk rat ing & a lgor i thmWe provide the flexibility to implement your own proprietary risk rating andalgorithm at overall client, individual client objective, and product levels.

In tegrate seamlessly wi th current systemsIntegrate the solution with your existing tech stack, including client book ofrecord, product shelf, risk algorithms and portfolio management systems.

Faci l i tate audi t - readiness & recordkeepingEmpower your compliance teams to monitor regulatory and operationalrisk. Always be audit-ready.

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Minimize b ias wi th automated sui tabi l i tyMatch product risk and cost with investor objectives and presentalternatives that are within risk tolerance.

Improve conversat ions wi th v isual in terfaceOur modular solutions enable better quality advisor conversations throughan intuitive, highly visual interface.

Remove f r ic t ion wi th d ig i ta l Form CRSBuild your own Form CRS template or use our default form. Automaticallygenerate and deliver relationship summary and disclosure of potentialconflicts of interest based on product recommendation.

ADVISORS

Bui ld conf idence wi th shared screensNo hidden screens or fine print. Our shared screens enableadvisors to collaborate with clients to review their objectivesand recommend suitable products.

Provide fu l l fee & product t ransparencyAdvisors can reinforce the value of their advice with totaltransparency around fees and disclosures. Clients can see howproduct recommendations align with their best interests.

Focus on c l ient object ives & progressOur flexible platform ties your product recommendations to aclient’s risk profile and objectives, and helps them track theirprogress.

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CLIENTS

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Turn Reg BI into a growth opportuni ty wi th f r ic t ion- f ree solut ions for t ransparency and except ional c l ient exper iences.

SUMMARY

Industry regulations are not going away, and will continue to make compliance morecomplex. The time is now to seize every opportunity to embrace higher professionalstandards and up your fiduciary game. Proactive firms are taking a leadership stance and positioning their firms for success bydelivering what investors have clearly said they want – greater transparency and opencommunication. The implementation of Reg BI represents another giant step on the road to providingclients with a better, more trusting experience with their wealth advisors. Firms that deliver a seamless Reg BI experience, visibly putting investor best interestsfirst, will advance competitively in the eyes of their current clients and future prospects.

PureFacts advantage

Mission-critical wealth management solutions since 2010Fully bootstrapped and profitable every year since inception~50 clients with total AUM of $250+ billion

T R U S T E D W E A L T HT E C H N O L O G Y P A R T N E RT O L A R G E B A N K S A N DL E A D I N G I N V E S T M E N TF I R M S .

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Regulatory expert iseWe have extensive experience in managing conduct riskand conflicts of interest for our financial servicescustomers, combined with our years of regulatorycompliance expertise.

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WE TAKE THE FRICTIONOUT OF REG BICOMPLIANCE.

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REGULATION BEST INTEREST

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