Letter from the 2022 Council Chair
As the 2022 Chair of the Securities Industry/Regulatory Council on Continuing Education (Council), I would like to continue the tradition established by my predecessors and provide you with a review of the 2022 activities and accomplishments of the Council. As described in the following sections, the Council’s primary mission continues to be implementing improvements and modernization to the Securities Industry Continuing Education Program (CE Program) to better serve the industry’s continuing education (CE) needs. This year was particularly exciting in that regard as the Council, working with industry regulators and the industry, made meaningful progress toward the implementation of CE Program transformation.
In 2022, the Council was composed of 16 industry members and six self-regulatory organization (SRO) members, as well as SEC, NASAA and SRO liaisons to the Council. Industry members generally serve four-year terms, and the Council meets quarterly.
The Council has specific advisory and consultative responsibilities to the CE Program. These are:
II. recommending and approving new content topics for the Practical Element component of the Maintaining Qualifications Program (MQP);
III. recommending updates to the Firm Element guidance;
IV. promoting effective implementation of meaningful CE to the securities industry;
V. liaising with appropriate industry groups and regulators; and
VI. maintaining the program on a revenue neutral basis subject to adequate financial reserves.
There are five standing Council committees: the Executive Committee, the Regulatory Element Committee, the Firm Element/Strategic Planning Committee, the Finance Committee and the Nominating Committee.
An additional ad hoc committee, the Change Management and Communications Committee, convened in 2020. This newly established committee continues to focus on change management and communications strategy efforts related to the CE transformation initiative. In the following sections, I will share some of the Council’s 2022 accomplishments.
I. The Regulatory Element Program
Katharine Michaels, senior vice president, head of supervision with Raymond James Financial Services Inc., served as chairperson of the Regulatory Element Committee in 2022. The Regulatory Element is currently comprised of two distinct programs: the S101 General Program for Registered Persons and the S201 Supervisors Program for Registered Principals and Supervisors. The committee has helped maintain these programs to keep them current until replaced in January 2023.
In preparation for upcoming changes to the CE Program discussed in FINRA’s Regulatory Notice 21-41, the committee's goals have included working on topic selection and ongoing evaluation of topics for the new annual Regulatory Element to be launched in January 2023. The annual learning plans—which will replace the current S101 and S201—will include registration-specific, tailored content that addresses rules, regulations, industry trends and core content of fundamental importance to the industry or of regulatory concern. Regulatory Element content is developed cooperatively by FINRA CE staff, CE Content Committees composed of industry subject matter experts, along with SEC, SRO and NASAA representatives, who meet periodically for this specific purpose.
The committee has worked with FINRA to publish the Regulatory Element learning topics for the coming year in advance. An interactive tool, launched on FINRA.org on October 1, displays the learning topics that each registration will receive as part of the Regulatory Element in 2023. In addition to the topics, the corresponding course titles along with a brief description of the courses are available.
II. The Practical Element Component of the MQP
Additionally, the committee has been working on developing content standards for the new MQP launched March 2022. Specifically, the committee developed a topic identification and prioritization process to facilitate robust CE content for participants in the program. From this process, learning plans were created, and courses were developed and launched in July 2022.
III. The Firm Element
This year’s Firm Element/Strategic Planning Committee chairperson was Patricia Mittler, executive director at UBS Securities LLC. This committee reviews industry issues and trends and provides guidance for Firm Element tools that may be useful to the industry.
In 2022, the committee published updated guidance on the Firm Element requirement on the Council website. The committee also revamped the frequently asked questions to ensure both documents were in alignment.
Additionally, the committee redesigned the Firm Element Advisory. This document for the industry highlights current regulatory and sales practice topics for possible inclusion in a firm’s Firm Element training plan. The new version, now called the Firm Element Needs Analysis Quarterly Highlights, was published in June 2022. Council publishes this document quarterly on the Council website and includes topics identified from a review of industry, regulatory and SRO announcements, and publications of significant events. Such topics may center around new or amended rules and regulations (e.g., Regulation BI), regulatory notices, and SRO guidance.
IV. Promotion of Effective CE in the Securities Industry
The Council website, www.cecouncil.com, serves as a reliable source of information and assistance to the securities industry with respect to industry CE programs and compliance. A variety of tools and materials are available to assist individuals in preparing for their Regulatory Element sessions. Additional tools and resources are available on the Council website to assist firms in developing their Firm Element training programs.
This year’s chair of the Change Management and Communications committee was Steve Longo, Americas head of surveillance, independent compliance risk management with Citigroup Global Markets Inc. The committee drafted and published a CE Transformation Playbook to provide resources to assist firms with managing the upcoming changes to the CE Program. The committee utilized input from a focus group of industry professionals while creating the playbook to ensure the content was relevant and comprehensive. In addition to consolidating reference materials and links to information, playbook documents include Key CE Transformation Milestones, a Before and After Summary Table, and Stakeholder Considerations. The playbook is a living document that will be updated over time with additional resources as they become available.
V. Liaising with Appropriate Industry Groups and Regulators
On occasion, Council members or SRO staff who support Council functions speak at industry conferences to keep the industry apprised of the latest issues and matters regarding the CE Program and to receive feedback on Council initiatives.
As part of our outreach, members and liaisons to the Council have spoken about the CE Program to industry representatives at the following meetings in 2022:
- Association of Registration Management’s Annual Conference (ARM);
- Licensing and Registration Council/Registration and Qualifications Subcommittee meetings (LRC); and
- Securities and Insurance Licensing (SILA) Annual Conference.
The Council is grateful for the SEC’s continued support over the years. Special thanks to the Commission’s staff from the Office of Chief Counsel in the Division of Trading and Markets who have worked so closely with us: Daniel Fisher, Edward Schellhorn and Kyra Grundeman.
VI. Maintaining the Continuing Education Program on a Revenue Neutral Basis
One of the responsibilities of the Council is to provide advice and consultation on maintaining the CE Program on a revenue neutral basis while ensuring adequate financial reserves to maintain and improve the programs.
The Finance Committee regularly reviews the financial health of the CE Program to ensure that it remains positioned to continue our mission. Russ Davidson, compliance director at Credit Suisse, served as the 2022 Finance Committee chairperson.
The Council continually seeks to raise the industry’s awareness of both the Council and its mission to promote and improve the CE Program within the securities industry. The Council continues to be grateful for the SEC’s commitment to this goal and would appreciate continuing support from you and your fellow commissioners to raise awareness of the Council’s work and of the importance of the CE Program in general. On behalf of the Council, thank you for your support. I will be happy to answer any questions you might have.
2022 Chair of The Securities Industry/Regulatory Council on Continuing Education
Chief Compliance Officer