Securities During A Pandemic

By TDCI Assistant Commissioner Elizabeth Bowling
Tuesday, April 07, 2020 | 12:00pm

I am sure that at the top of everyone’s mind right now is the COVID-19 pandemic and its impact on our lives. It feels like, in some ways, that our day-to-day routines have been brought to a grinding halt. However, with each day that passes, we realize that we are finding different ways to carry out our duties.

I want to let you know what the Tennessee Department of Commerce and Insurance’s (TDCI) Securities Division is doing during this time, how COVID-19 has impacted the operations of the Securities Division, and items to be on the look out for in the coming weeks.

First, the transition of our Securities Division’s employees working remotely has been relatively smooth. All employees still have access to their emails and phone lines, and mail is still being received and processed by the Division on a daily basis. So, if you have wondered if the Division is currently operating or how to contact the us during this time, the answer is “Yes, we are open!” and to contact us as you normally would. All contact information for the Securities Division can be found here. In addition, here is a link where up-to-date actions taken by TDCI affecting all Divisions, including the Securities Division here.

Since the onset of the pandemic, my team has received a high volume of calls about how to file initial offerings or renewals. Our Division is fully operational and running as normal, so you may still submit offerings for registration notice filings or exemption filings. If this is by mail, please include the filing fee with the submission. Please also note that these fees are continuing to be processed and must be included or the filing will be deficient.

For state registered Investment Advisers, this is a reminder that the annual amendment to your ADV and your balance sheet is due 90 days after the close of your fiscal year end, as required by Tennessee Securities Rule 0780-04-03-.02(4). For those of you with a December fiscal year end this means these two items were due by March 31st. The ADV annual amendment should be submitted through the Financial Industry Regulatory Authority (FINRA) Investment Adviser Registration Depository (IARD) system. You may submit your balance sheet as you normally would. If you haven’t submitted these yet, please go ahead and get these submitted to the Securities Division for processing.

Finally, I’d like to remind all Tennesseans that during this turbulent time we believe that scammers will be targeting investors. The Division recently released a press release about this that can be found  here. It is important for everyone to keep this at the front of their mind when someone approaches them about an investment possibility with high pressure sales tactics.

In addition to being aware of scammers and their red flags, it is also important to not have a “knee jerk reaction” to the current volatility that the market is experiencing. Before changing investments to something touted as “safe” or those with “guaranteed returns” be sure to take the time to look closely at change fees or termination fees that may be incurred. This type of advice may especially target retirees and senior citizens in Tennessee. These scammers oftentimes falsely claim that they can quickly and safely recoup any losses to retirement portfolios. It is one of our priorities to keep the elderly community safe and secure from scammers during this vulnerable time.

Always remember that when something sounds too good to be true, it usually is.