Registration, Disclosure and Filing Requirements

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Adviser Charged with Defrauding Clients

Adviser Charged with Defrauding Clients WHAT HAPPENED? On December 11, 2017, the SEC charged a dually registered investment adviser and broker-dealer, and its principal (collectively, the “Defendant”), with defrauding its clients and receiving $780,000 in ill-gotten gains.  Over the course of several years, Defendant repeatedly purchased securities from underwriters [...]

Department of Labor Announces 18-Month Delay of the Fiduciary Rule

Department of Labor Announces 18-Month Delay of the Fiduciary Rule WHAT HAPPENED? The Department of Labor has announced that the applicability date of the Fiduciary Rule’s Best Interest Contract Exemption, the Principal Transactions Exemption and specific amendments to Prohibited Transaction Exemption 84-24 (PTE)s have been delayed from January 1, [...]

SEC Charges Unregistered Fund Manager

SEC Charges Unregistered Fund Manager WHAT HAPPENED? On October 26, 2017, the SEC charged an unregistered investment adviser and its principals (“collectively, the “Respondents”) with engaging a private fund it managed (the “Fund”) in conflicted transactions without providing disclosure to the investors. The conflicted transactions that Respondents performed includes [...]

House Panel Passes Bill to Repeal DOL Fiduciary Rule

House Panel Passes Bill to Repeal DOL Fiduciary Rule WHAT HAPPENED? On October 12, 2017, the House Financial Services Committee passed the Protecting Advice for Small Savers Act of 2017 (the “PASS Act”), which would repeal the DOL’s Fiduciary Rule.  This bill would keep fiduciary rulemaking under the SEC’s [...]

Reminder that the New Form ADV Rules Took Effect on October 1, 2017

Reminder that the New Form ADV Rules Took Effect on October 1, 2017 WHAT HAPPENED? On October 1, 2017, the amendments to Part 1A of Form ADV and the Investment Advisers Act of 1940 (the “Advisers Act”) took effect.  The amendments, which are described in a previous Flash Report, [...]

DOL Provides Conflict of Interest FAQs Around Fiduciary Rule

DOL Provides Conflict of Interest FAQs Around Fiduciary Rule WHAT HAPPENED? On August 3, 2017, the DOL released a conflict of interest FAQs to provide additional clarification around the Fiduciary Rule. In the FAQ, the DOL provides guidance regarding: Fiduciary status disclosures that must be provided by ERISA pension plan service providers [...]

Dual Registrant Fails to Disclose Conflict of Interest from Revenue Sharing

Dual Registrant Fails to Disclose Conflict of Interest from Revenue Sharing WHAT HAPPENED? On July 19, 2017, the SEC charged a dually-registered investment adviser and broker dealer (“Respondent”) for failing to disclose compensation received from a third-party broker-dealer (“Broker”). Starting in 2002, Respondent waived transaction fees it and Broker would otherwise charge [...]

Upcoming Amendments to Form ADV

Upcoming Amendments to Form ADV WHAT HAPPENED? The new ADV reporting requirements go into effect October 1, 2017. Under the revised Form ADV, advisers will: require investment advisers to disclose additional information about their separately management account (“SMA”) business; require investment advisers to report specific information on general business operations, [...]

SEC Updates Form ADV FAQs

SEC Updates Form ADV FAQs WHAT HAPPENED? On June 12, 2017, the SEC released new Form ADV FAQs to provide guidance on recent amendments made to the form. The additions to the FAQs are related to Items 1.I, 1.J, 5.D, 5.K, 7.B and Schedule R. The SEC also provided an update [...]

SEC Amends Form ADV Part 1A and the Advisers Act

SEC Amends Form ADV Part 1A and the Advisers Act WHAT HAPPENED? The SEC adopted amendments to Part 1A of Form ADV and the Investment Advisers Act of 1940 (the “Advisers Act”) to better monitor various risks in the investment management industry. Collectively, the amendments will: require investment advisers to [...]