NACUSO, SEC In Fight Over Compliance Issue
Hundreds of CUSOs offering financial advisory services could be in jeopardy unless the U.S. Securities and Exchange Commission acts to extend their exemption to operate, CU officials were told here.
Negotiations between the National Association of CUSOs (NACUSO) and the SEC to alleviate the situation have bore little fruit so far with regulatory deadlines to extend the exemptions looming, noted Guy Messick, general counsel for NACUSO, during the group's annual meeting here. "The SEC says CUSOs are out of compliance now," said Messick, who participated in a teleconference with SEC representatives from Las Vegas. If the SEC does not extend the CUSO exemption from SEC registration then some CUSOs may choose the costly process of SEC registration, while many credit unions may choose to move their investment advisory in-house under the new incidental powers reg, eliminating their ability to serve non-credit union members, suggested Messick. This could deprive many smaller CUs of access to investment advisory businesses, he said.