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Exemption from MFDA membership denied; investor protection outweighs administrative and financial burdens of restructuring.
The applicant, a group retirement plan administrator registered as a mutual fund dealer and portfolio manager, sought an exemption from the requirement to become a member of the Mutual Funds Dealers Association (MFDA).
The applicant argued its business model, which included discretionary trading, was incompatible with MFDA rules and that restructuring would be costly and confusing to clients.
The Commission denied the exemption, emphasizing that investor protection and the benefits of MFDA oversight outweighed the administrative and financial burdens of restructuring.
A temporary exemption was granted to allow the applicant time to apply for MFDA membership.
