REG BI ENFORCEMENT POISED TO TAKE NEXT STEP

January 15, 2024

Ever since Regulation Best Interest went into force, financial advisors have been waiting to see how it would change the oversight of in-vestment advice. They may get more insight this year. The Securities and Exchange Commission im-plemented the broker-dealer standard of conduct in June 2020 during the Covid pandemic. The agency essentially gave financial firms a year’s grace peri-od in which it expected a “good-faith” effort to come into compliance with the rule, which prohibits bro-kers from putting their revenue interests ahead of their clients’ interests in investment returns. Starting in mid-2021, the SEC brought enforce-ment cases against firms that failed to file – or were delayed in filing – their Form CRS, a disclosure document that was part of the Reg BI rule-making package. In mid-2022, the SEC took its first substan-case that could only have been brought under Reg BI, said Sander Ressler, owner and managing di-rector of Essential Edge Compliance Outsourcing Services. “Regulators are looking at [Reg BI] very closely,” Ressler said. “This is going to be something that is going to be front and center in terms of regulatory actions in 2024.” REG BI CARE OBLIGATION Ressler anticipates an enforcement case that is based on Reg BI’s care obligation, which requires that a broker understand the potential risks, re-wards, and costs of a recommendation and whether it is in the customer’s best interests based on those factors. The broker also must consider reasonably available alternatives. Whether brokers look at the investment land-“Regulators are going to take a much heavier hand when it comes to reviewing apples-to-apples product comparisons” SANDER RESSLER, ESSENTIAL EDGE COMPLIANCE OUTSOURCING SERVICES

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Brokers have been wondering whether they’re complying correctly with the standard of conduct. Enforcement cases this year may shed more light than ever before

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Compliance and Regulatory Authority Sander Ressler Launches Arbitration IQ

By Lindsey Hawkins • October 28, 2025
Arbitration IQ provides expert testimony to securities law attorneys, claimants, respondents and regulators in actions involving securities law. The firm is founded and led by Sander Ressler, who ranks among the nation’s most sought-after securities law expert witnesses. He has worked on more than 600 arbitration cases, provided testimony in 150 hearings and worked with more than 70 law firms. Learn more at: www.arbitrationiq.com.

Judge OKs release of $400 million to besieged GPB investors - InvestmentNews

April 21, 2025
A federal judge in Brooklyn last week approved the release of $400 million in funds to some of the beleaguered investors in GPB Capital Holdings who have not seen a nickel or returns since 2018, when the private placement investment scheme began to unravel.  Meanwhile, the sentencing of two top GPB executives, founder David Gentile, and broker-dealer and sale chief Jeff Schneider, was scheduled for this week but has been moved to May, according to court filings. Last August, a jury in federal court in Brooklyn found Gentile guilty of five counts of fraud and Schneider three. The federal government’s charges stemmed from their management of GPB Capital Holdings, which was founded in 2013, GPB Capital. The money manager sold its high risk private placements through dozens of independent broker-dealers and five years later had raised $1.8 billion from wealthy clients looking for yield in a decade ago when interest rates were next to zero.