Kansas Securities Regulator Suspends IA Firm

November 28, 2006

Earlier this fall, the Office of the Kansas Securities Commissioner entered an order to summarily suspend the investment advisor registration of a state firm located in Overland Park, Kansas. According to the Commissioner’s Press Release, the “firm committed fraud by informing a client that his funds were maintained in an account at a brokerage firm when, in fact, the funds were pooled with the funds of other investors in a second account controlled” by the advisor firm’s president. The firm also apparently did not fully cooperate with the state examiners during their investigation. This enforcement action serves as example as to how Kansas securities regulator will respond when an investment advisor attempts to circumvent state securities laws.

The Kansas Securities Commissioner has also become more visible through a series of television and radio advertisements encouraging the investing public to conduct its own investigating before hiring a Kansas based financial professional. In conjunction with these efforts to educate the public, Kansas has initiated a proactive approach to regulatory examinations and has already conducted numerous audits. As a result, it’s imperative that investment advisors located in Kansas ensure that they are implementing effective compliance programs and controls.

If your firm is located in Kansas and wants to discuss how RIA Compliance Consultants can help your firm meets its regulatory requirements, please give us a call at 877-345-4034.

Posted by Bryan Hill
Labels: Custody, Enforcement