The SEC issued a risk alert yesterday relating to a series of examinations OCIE (Office of Compliance Inspections and Examinations) conducted that focused on investment advisors that operated from numerous branch offices and that had operations geographically dispersed from the advisor’s principal office.
On December 14, 2018, the SEC’s Office of Compliance Inspections and Examinations (“OCIE”) issued a risk alert to remind investment advisors of their obligations with respect to electronic communications and social media and to help advisors improve their systems, policies, and procedures.
On October 31, 2018, the SEC’s Office of Compliance Inspections and Examinations (“OCIE”) issued a risk alert providing investment advisors with information regarding the most common deficiencies SEC staff have cited relating to Rule 206(4)-3 (the “Cash Solicitation Rule”) under the Investment Advisers Act of 1940.
On April 18, 2018, the SEC proposed an interpretation to reaffirm and clarify the Commission’s views regarding the fiduciary duty that investment advisers owe to their clients. In discussing this fiduciary duty, the SEC hopes to clarify for both advisers and their clients the legal obligations investment advisers have to their clients. In addition, the SEC proposed Form CRS, which would require advisers (and broker-dealers) to provide a “relationship summary” to retail investors.
A recent administrative proceeding involving a dual-registered investment advisor and broker-dealer demonstrates the importance of providing full and fair disclosure regarding any material conflict of interest and achieving best execution on behalf of advisory clients.
Late last month, the SEC announced that staff at OCIE are now closely looking at whether registered investment advisors and broker-dealers are complying with the agency's whistleblower regulations under Rule 21F-17. Here is what you need to know.
The SEC recently adopted rules, originally proposed in May 2015, that expand the disclosure requirements in Form ADV, Part 1A. These amendments will be effective 60 days after the publication in the Federal Register and investment advisors will need to start complying starting on October 1, 2017. This means that if your firm's fiscal year ends on December 31, 2017, you will need to comply with the Form ADV changes no later than your annual amendment filing in March 2018. A summary of the more substantive enhancements to Part 1A is provided below.
An SEC mock audit is an important tool that your registered investment advisor can utilize to help ensure that your firm is in compliance and your employees are prepared the next time the SEC appears at your door.
With the SEC increasingly focusing on problematic allocation practices such as cherry-picking, registered investment advisors, more than ever, should ensure that they have strong allocation policies and procedures.
Chief Compliance Officers should be constantly questioning how their compliance program can be improved. As a starting point, here are eight questions to consider.