The Municipal Securities Rulemaking Board’s quarterly meeting on October 26-27 will discuss authorizing a request for comment on a proposal to exempt municipal advisors from the obligation to requalify association with a municipal advisor firm via examination after a two-year lapse.
The board recently voted to amend its Rule G-40 to allow municipal advisors to use testimonials in advertisements, which lobbyists appreciated for its alignment to Securities and Exchange Commission’s Investment Advisor rule, but otherwise said it was uncontroversial.
But these efforts also fall in line with the SEC’s increased focus on municipal advisors, highlighted in its August 2022 risk alert that targeted municipal advisor registration, filings, recordkeeping, supervision and disclosure of conflicts of interest.
While much of what was said in the risk alert was outlined in a similar 2017 risk alert, law firm Mayer Brown warns this “may signal an increase in scrutiny from SEC examination and enforcement staff regarding municipal advisor practices.”
The board will also discuss the scope of its Form A-12 modernization efforts on registration, extending COVID relief again under MSRB Rule G-27 on supervision of dealers, and will receive an update on the MSRB’s proposal to amend MSRB Rule G-14, the controversial new proposal that would require transactions be reported within one minute of time of trade.
The MSRB will also receive an update on its ongoing efforts to modernize the EMMA website, which according to Mark Kim, chief executive officer of the MSRB, will eventually look more in line with its newly revamped MSRB.org site.
The board will also discuss the potential collection of pre-trade data and will foster discussion about diversity, equity and inclusion concerns in the muni market.
“In furtherance of its mission to create a more fair and efficient market, the Board will receive an update on a series of roundtable discussions with minority, women and veteran-owned firms the MSRB is hosting in collaboration with FINRA to identify opportunities to foster greater diversity and inclusion in the municipal securities market,” the board said.