The staff of the Division of Investment Management released its much-anticipated study (required by Dodd-Frank) concerning investment adviser examinations.  In the study, the staff admits that it will not have sufficient resources to sufficiently examine the ever-growing number of registered investment advisers.  The staff requests Congress to consider three alternatives: (1) allow self-funding by authorizing the SEC to impose user fees on RIAs; (2) authorize one or more SROS; or (3) authorize FINRA to examine dual registrants.  The SEC argues that imposing user fees is the best of the three alternatives.

OUR TAKE: Perhaps most significant is the SEC officially endorsing the use of an SRO or FINRA to assist the examination process.  Although the SEC posits the three options as alternatives, Congress may not see them as mutually exclusive. 

 http://www.sec.gov/news/studies/2011/914studyfinal.pdf