As they say: The more things change, the more they stay the same.

Last year, I sat in one packed session after another at the American Bankers Association Wealth Management conference in Phoenix,  while it rained for three days straight. This year I am here in South Miami Beach and while it’s a beautiful 80 degrees outside the concerns that the attendees are talking about as they sit in conference sessions and mingle in hallways are the same one year later: regulatory reform.

Yes, the Dodd-Frank Act, that 2,000 page document that outlines over 100 different regulatory proposals and dozens of studies, has passed. Yet those who work in wealth management and bank trusts still don’t know what these reforms will mean for their businesses – and their jobs. 

The Congress has changed and the new Congress, as Phoebe Papageorgiou, Senior Counsel at the American Bankers Association, pointed out is controlled by Republicans. It’s still not clear what that will mean. But one thing is certain: the industry before Dodd-Frank will not look like the industry after Dodd-Frank.

One concern that James Marion, Managing Director, Office of Chief Fiduciary, U.S. Trust, Bank of America Private Wealth Management, touched upon is the new Consumer Financial Protection Bureau, which regulates and examines the provision of consumer financial products or services (for example, advisory services and custody). “Who is a consumer though?” Marion asks. “A consumer is not only an individual human being, but a trustee, agent or representative acting on behalf of an individual. This impacts some of the things we do with our clients.”

Another worry is the proposal to require municipal advisor registration, which would require anyone who provides advice with respect to municipal financial products or insurance of securities to register and follow rules of conduct, attain CE credits, and follow fiduciary standards, which especially impacts banks and bank employees. Marion explained that the SEC proposal expands the statutory language so broadly that it requires registration if providing advice about “funds held by or on behalf of a municipal entity.” This could mean, Marion explained, that someone who sits on a city council board and advises the board could need to register as a municipal advisor. Because of how broad the proposal is many municipal entities themselves have written letters to get a legislative fix in Congress, Marion said. “It is not clear that the SEC can regulate all these entities effectively even if it did have jurisdiction to do so,” added Papageorgiou.

Meanwhile, the SEC has proposed two rules relating to registered investment advisor clients, which raises concerns for Marion. These rules would allow the SEC to request documents relating to custody of RIA client assets from banks to prevent another Bernie Madoff-type scheme. But, Marion asks, “Who is the RIA client?” “What the custody rule says is if an RIA is using an affiliated custodian than you have to jump through a whole bunch of hoops to show the assets are with a custodian and make sure there are independent audits.”

The Investment Advisor Act had many implications for banks, bank trusts, and bank employees, especially rules around family offices. Marion pointed out that many family offices have lost their definition as a family office because a family office must be a single family. In addition, the private advisor exemption has been eliminated, which explicitly excludes family offices from the definition of investment advisor.

Meanwhile, the SEC study on broker-dealer standards concluded that broker-dealers should be subject to the same “fiduciary” standard as RIAs when providing specified advice on investment decisions, explained Marion. “It completely ignores the fact that the main provider of fiduciary advice are bank trust departments,” Marion said. “The SEC study was ill-advised and ignores the core concept of what our business is. This affects not just small broker-dealer firms, but bank trusts as well.”