MSRB Proposes Professional Qualification Requirements for Municipal Advisors (with Lofchie Comment) (Notice 2014-08)

The MSRB requested public comment on a proposal that would set professional qualification standards for municipal advisory professionals and require municipal advisors, and their associated persons engaging in municipal advisory activities, to be qualified in accordance with MSRB rules.

Under the draft amendments to MSRB Rule G-3 ("Classification of Principals and Representatives; Numerical Requirements; Testing; Continuing Education Requirements"), registration classifications would be added for municipal advisors to distinguish between (i) those who engage in municipal advisory activities, or municipal advisor representatives, and (ii) those who engage in their management, direction or supervision, or municipal advisor principals. Additionally, municipal advisor representatives would be required to take and pass a professional qualification test to demonstrate a minimum level of competency before providing or continuing to provide financial advisory services to state and local governments. The MSRB proposed a one-year grace period in which to take and pass the test for all individuals currently engaged in municipal advisory activities.

Comments on the draft amendments should have been submitted to the MSRB by May 16, 2014. The MSRB is also hosting an educational webinar on the main aspects of the professional qualification requirements for a municipal advisor on April 3, 2014, at 3:00 p.m.

Lofchie Comment: Taking these qualification exams is a lot of work for those in the financial industry; if more tests are to be required, then perhaps there should be a study of whether they are actually useful.

See: MSRB Regulatory Notice 2014-08. See also: Submit Comments to the MSRB.