Category: Client Forum, Financial Intermediary Administration

Intermediary Oversight: Dominant Topic at the Client Forum and Beyond


room-setup-resizedSince I was competing against beautiful Northern California weather and the vibrant city of San Francisco, I thought I might be alone during the Intermediary Oversight best practice session at the Client Forum. However, intermediary oversight continues to be a dominant theme across the industry and I was pleasantly surprised to have almost 40 industry colleagues join me to discuss this topic.

Although I was the session facilitator, our clients kept the conversation going and posed a number of questions for each other.

Here are some session highlights:

  • We’re nearing the end. The majority of omnibus conversions are almost  done. The large ones are completed and the focus is on some regional firms.
  • Oversight programs are evolving.  Our clients are continuing to develop and enhance their programs with a key focus on onsite visits, questionnaires, oversight teams, and risk rankings.
  • FICCA is part of the solution but not the only aspect needed of an oversight program. Although clients are seeing an increase with FICCA, adoption is slow and not all top firms will complete it. Some challenges include:
    •  There is not an industry-wide list of all the firms that have completed a FICCA so you don’t know which firms to contact for a copy
    • Once you identify who has  completed a FICCA, you then need to  identify key contacts to request it
    • There are several areas of a FICCA that are missing so there is a need to evaluate which areas need additional review
    • Some firms that provide FICCA will not allow an onsite visit. However, clients do not agree with this approach, as they view FICCA as just one tool in the toolbox.
  • Clients are looking to improved data management with a focus on oversight. Some firms are looking to data mining versus onsite meetings or other historical forms of oversight. Data sources include: review of industry and federal websites (sanctions, issues, etc.) and request reports from intermediaries
  •  Sometimes intermediaries aren’t responsive. Clients shared some ideas on how they address:
    • Conference calls
    • Follow up questionnaires based on areas that were missing on FICCA
    • Some have pursued withholding TA payments or suspended trading

This remains a very hot topic in the industry. In fact, it was also a prevalent topic throughout the NICSA General Membership Meeting. Barbara Browne will be talking about the intermediary oversight themes discussed there in the next blog post. Funds are focused on eliminating gaps in their programs and looking for industry best practices to best manage and oversee their intermediary relationships.  Overall, the session was extremely interactive and I found it insightful into the current areas of focus related to intermediary oversight. I suspect we will be hosting one of these sessions at next year’s client forum in Chicago.

Mike McNeill

Mike McNeill

Mike is a member of the senior relationship management team. He is focused on enhancing client relationships and collaborating on business solutions to address the evolving needs of the industry and regulatory landscape. Mike has over 25 years of experience in the mutual fund industry. Prior to joining Boston Financial, he served as senior vice president of investor services at Putnam Investments. Previous to Putnam Investments, Mike was at Pioneer Investments and American Express - The Shareholder Services Group. Mike currently serves on the Investment Company Institute (ICI) Broker-Dealer Advisory Committee. An active member of the National Investment Company Service Association (NICSA) and ICI, Mike has served as a speaker and moderator for internal and external events as well as a spokesman for the company on mutual fund industry topics with a focus on intermediary relationships and oversight.


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