Learn About the Exemption for Investment Advisers from New Beneficial Ownership Reporting Requirements

February 02, 2024

With the new requirements that corporations, limited liability companies and other entities report the identities of their beneficial owners to the Financial Crimes Enforcement Network (“FinCEN”), the chief compliance officer (“CCO”) of an investment adviser firm and sponsors of pooled investment vehicles should be aware that certain investment adviser firms and pooled investment vehicles are eligible for an exemption from FinCEN’s beneficial ownership reporting requirements.

Continue Reading

Lawsuit Filed Against Montana for Discriminatory Investment Adviser Representative Registration Fees

January 13, 2024

Litigation Alert

According to the Daily Montanan, a class-action lawsuit has been filed against the State of Montana. This lawsuit challenges the constitutionality of a licensing fee structure imposed on non-resident investment adviser representatives and securities salespersons, alleging it violates the privileges and immunities clause of the United States Constitution.

Continue Reading

Understanding Nebraska’s Annual Reporting Requirements for State-Registered Investment Advisers

November 14, 2023

For investment adviser firms which are state registered with Nebraska, it’s crucial to be aware that there are certain additional documents which must be submitted directly (via a ShareFile link) to the Nebraska Securities Bureau in addition to and separate from the paying the regulatory fees associated with annual renewals and filing the Form ADV Annual Amendment via the IARD (“Investment Adviser Registration Depository”) system.

Continue Reading

Navigating the Preliminary Renewal Statement for Investment Advisers

November 11, 2023

Understanding and Managing Your Firm’s Preliminary Renewal Statement

As we approach the end of the year, it is crucial for investment adviser firms to review their 2024 Preliminary Renewal Statements, which are now accessible through their IARD accounts. This statement is an overview of the firm’s current registration status and the associated renewal fees. Let us delve into the specifics of this renewal statement and its implications for your investment adviser firm.

Continue Reading

Failure to Properly Renew Registration May Result in Adverse Consequences for Investment Advisers

October 19, 2023

Investment adviser firms and investment adviser representatives must maintain active registrations and/or notice filing statuses with applicable jurisdictions/states. Unless properly renewed, all investment adviser firm and investment adviser representative licensing approvals expire December 31 each calendar year. To ensure that investment adviser firms and their investment adviser representatives are properly licensed in all necessary jurisdictions for 2024, renewal fees must be paid through the Investment Adviser Registration Depository (“IARD”) system.

Continue Reading

SEC Taking a Closer Look at Whether Investment Advisers Are Obtaining “Informed Consent” When Amending Advisory Agreements

October 17, 2023

New Exam Priority

The Division of Examinations of the U.S. Securities and Exchange Commission (“SEC”) recently issued the Fiscal Year 2024 Examination Priorities signaling areas of particular interest for the upcoming audits of investment advisers. Notably, this year’s exam priorities introduces what appears to be a new focus on whether investment adviser firms are obtaining “informed consent” from clients when making material changes to advisory agreements:

Continue Reading

Investment Adviser Enters Guilty Plea for Alleged Cherry Picking Scheme

October 08, 2023

The U.S. Attorney’s Office (District of Connecticut) announced that it entered into a plea agreement with an owner/investment adviser representative of an investment adviser firm based in Connecticut.  This CT investment adviser representative waived his right to be indicted and pled guilty to defrauding clients of $2.7 million through a cherry-picking scheme. Last month, the U.S. Securities and Exchange Commission (“SEC”) also issued a cease-and-desist order against this investment adviser representative and firm. This blog post will review the cherry-picking allegations and offer several best practices for a chief compliance officer (“CCO”) to detect such activity within his or her own investment adviser firm.

Continue Reading