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Sen. Dodd launches financial-reform bill
Sen. Christopher Dodd, D-Conn., has unveiled his financial-reform bill, including a call to strip the Federal Reserve of its supervisory power over banks. Under the bill, the Fed would no longer be able to offer emergency loans to individual companies and would lose all of its bank-supervision and consumer-protection power, and the government would have a voice in how the Fed's 12 regional banks are governed. Dodd's bill differs markedly from a bill on financial reform in the House. The Wall Street Journal (11/11) The Washington Post (11/11) Financial-Planning.com/American Banker (11/10)

• Dodd bill would do away with "broker-dealer exemption": Sen. Christopher Dodd, chairman of the banking committee, has introduced legislation that would require brokers who provide investment advice to register as investment advisors. The bill would eliminate the "broker-dealer exemption" that was part of the Investment Advisers Act of 1940. "It would be a dramatic change," said Mercer Bullard, president and founder of Fund Democracy. "Virtually every broker-dealer would have to register as an investment advisor." InvestmentNews (free registration) (11/10)

Conditions are ideal for transferring ownership of family business
The economic downturn has created an ideal time for family businesses to transfer ownership of the company within the family, according to this article. "With business valuations depressed and interest rates near historic lows, owners can use wealth-planning strategies, such as trusts and other techniques, to pass bigger slices of their businesses to their heirs more cost-efficiently," said Joseph Fahey of Wells Fargo & Co.'s Private Bank. FA-Mag.com/Dow Jones Newswires (11/10)

Regulatory Report

FINRA, SEC: More clarity is needed on life-settlement regulation
Speakers from the Financial Industry Regulatory Authority and the Securities and Exchange Commission agreed during a panel discussion recently that they need to work for more clarity in the regulation of life settlements. "In terms of where the commission stands, there's a large gap because it hasn't really focused on life settlements as a product in the regulatory sense," said Eric Werner, a Texas-based branch chief of the SEC. InvestmentNews (free registration) (11/11)

Building Your Business

Advisors welcome new tools to manage risk
The need for investment advisors to develop new tools for measuring risk has intensified since the financial crisis, according to this article. While some advisors rely on documentation to gauge their clients' risk tolerance, others prefer to hold ongoing conversations with clients in order to continually reassess risk preferences. Nevertheless, advisors are often willing to experiment with new tools. Investment Advisor (11/2009)

Advisors have opportunity to help investors with Roth conversions
Google data indicate that the number of people conducting a search for the phrase "Roth IRA conversion" has tripled since January. This may reflect a desire by the public to learn more about the upcoming rule change that will allow those making more than $100,000 per year to convert their traditional individual retirement accounts or 401(k) plans with previous employers into Roth IRAs. The data also suggest an opportunity for advisors to become the source for that education, according to this article. InvestmentNews (free registration) (11/10)

Financial Products

Parents contribute less to 529 plans
The amount of money invested in 529 college savings plans dropped to $5.2 billion last year from $15.2 billion in 2007 and $15.5 billion in 2006, according to Financial Research Corp. Investors have put $4.8 billion into the plans so far this year, reflecting concerns over stock market declines that were detrimental to account balances. "Any new money going to my kids' college education is going into something that I manage myself," said Michael Singer of Coral Springs, Fla. The 529 plan he was using to save for his children's college education lost about half of its value. The Wall Street Journal (11/11)

Mutual funds shift tactics in effort to lure back investors
More mutual fund managers are trying to time the market, according to this article. The risky ploy comes as managers try to win back investors. Recent market declines have had investors asking for more flexible mutual fund products, which has also prompted the shift. The Wall Street Journal (11/12)

Retirement Focus

Confusion over mutual fund share classes could be about to end
The Investor Protection Act of 2009, which was recently approved by the House Financial Services Committee, includes measures that ultimately could kill off C-class mutual fund shares and help end confusion over share classes. The change, which is expected to draw much debate, is in the way funds are traded through advisors. Arizona Daily Star (Tucson)/MarketWatch (11/13)

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