Missouri recently brought the MC Hammer down on financial advisors, telling them, “U Can’t Touch This.”

The Show-Me State moved last month to prohibit financial advisors from using credential-sharing technology to manage clients’ held-away 401(k) assets, making it the first state to formally restrict the practice. Advisors can still use the technology to review client information, but they cannot use it to place trades or rebalance accounts. The rule is scheduled to take effect at the end of December.

What was once a dispute between financial services firms and technology providers is now a regulatory issue, raising questions about whether other states will follow Missouri’s lead. The measure could make it more difficult for advisors to provide comprehensive advice on clients’ 401(k)s. But there is an understandable argument for investor security, said Jania Stout, president of retirement and wellness at Prime Capital Financial, noting that she hopes the controversy leads to better ways for advisors to manage workplace retirement accounts.

“I could see other states following suit. But even if they don’t, it’s already getting harder and harder to use credential-sharing tools,” she said, adding that recordkeepers regularly contact customers to warn them against using the tools and require them to update their passwords every couple of months.

Let Us In

The issue began getting attention in 2024, when Fidelity, citing security concerns, announced plans to prevent credential-sharing technology from being used to access and manage customer accounts. The restrictions ramped up over the following year, with Charles Schwab enforcing similar rules.

In October 2025, Pontera, a fintech platform that lets advisors manage clients’ workplace retirement accounts, criticized Fidelity’s measures, claiming that the recordkeeper was having savers “locked under maximal institutional control” to steer business toward its own services.

This July, Missouri’s Securities Division proposed restricting advisors’ use of the tools under its rules governing dishonest or unethical business practices by investment advisors. The proposal drew several public comment objections:

• Pontera argued the amendment could eliminate a secure way to manage investor accounts, increase burdens on advisors and reduce investor choice and competition.
• The Financial Technology Association warned that smaller advisory firms could be disproportionately hurt by losing access to technology that helps them compete.
• Holmes Osborne, founder of Missouri-based RIA Osborne Global Investors, said existing regulations were sufficient.

More Than One Way To … Missouri’s rule doesn’t prevent advisors from making recommendations about clients’ 401(k)s. Advisors can still walk clients through the process using screen sharing or by sitting alongside them, allowing clients to execute transactions themselves, Stout said.

“It’s not ideal for advisors, but I remember a time when these tools didn’t exist,” she said. “Though the move might stall some advisors from being able to manage their clients’ 401(k)s, there are other ways to do it. They’re just not as efficient.”

Meet the new boss. Same as the old boss?

Big-ticket deals and record-breaking merger and acquisition activity in the registered investment advisor industry get all the headlines. Beneath the surface, thousands of advisors now work at firms they didn’t work for just a year ago. The change of employer can bring new management philosophies, compensation plans, product lineups and service areas. That can create new conflicts of interest and raise regulatory scrutiny, potentially jeopardizing the combined firm’s effort to boost scale and profitability.

“It’s not just speculation,” said Steve Brown, managing director at compliance software provider StarCompliance. “The SEC’s 2027 exam priorities name recently merged and acquired advisors as a specific focus area for the coming year. Firms must demonstrate that their compliance controls are not only documented but actively implemented and maintained.”

Advisors on the Move

There were 77 transactions between July and September and a total of 244 deals inked through the end of the third quarter, per DeVoe & Company. That’s on pace to set another annual record for 2026, and the deal volume has apparently caught the attention of federal regulators.

In its latest exam priorities, the SEC said it will focus on compliance practices when advisors have “undergone certain changes.” This includes:

• When advisors “have changed their business models or have started advising different types of clients, providing advice regarding new asset classes or providing new services.”
• When advisors “that have grown through mergers, acquisitions or other means, or are operating from multiple geographically dispersed branch offices.”

When firms are selected for review, the SEC will assess “whether the advisor has adapted its compliance program” as well as “whether it has identified and made any necessary changes to address new conflicts of interest.”

“What this says to me is that compliance needs a seat at the table during the due-diligence process and during the integration,” Brown said. “It’s also critical to make sure that policies that are spelled out are actually being applied.”

Compliance for Growth. While most firms take their regulatory responsibilities seriously, there can still be tension between executives charged with business development and those responsible for compliance.

“Being a good compliance officer isn’t about saying ‘no’ to everything,” Brown said. “It’s about protecting the business. It’s about getting out of your ivory tower, spending time with the business and understanding what you’re trying to accomplish.”

The more things change, the more they stay the same.

In less than a decade, the financial planning industry expects to be short roughly 100,000 advisors due to a massive retirement wave. At the same time, the US has gone through one of the greatest eras of wealth creation in history. “There’s more wealth and fewer advisors to service it,” said Dynasty Financial Partners CEO Shirl Penney.

Meanwhile, artificial intelligence and other technological advances are giving advisors new ways to scale their businesses. But advisors also need to remain focused on what makes their firms unique. Technology can help them serve more clients, but the human element of financial advice remains irreplaceable, Penney told Advisor Upside.

We caught up with Penney at the Charles Schwab Impact conference in Boston last week to discuss the talent shortage in the advice industry, how to avoid distractions in a complex world and the continuing cyborging of financial planning.

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