House Republican Re-Introduces Investment Adviser SRO Bill

May 01, 2012

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Rep. Spencer Bachus, the Chairman of the House Financial Services Committee, and Rep. Carolyn McCarthy have introduced a bill, the Investment Advisers Oversight Act of 2012, which would create a self-regulatory organization (“SRO”) for investment advisers.

The proposed bill, which is similar to one released last fall by Rep. Bachus, would amend the Investment Advisers Act of 1940 (“Advisers Act”) to create the “National Investment Adviser Associations” (“NIAAs”), which would be overseen by the U.S. Securities and Exchange Commission (“SEC”).  Investment advisers that are currently registered with the SEC or a state securities authority would be required to join NIAA.  However, state registered advisers would still be examined by their state securities authority.

The purpose of forming the SRO would be to increase the frequency of regulatory examinations of investment advisers.  Currently, only around 9% of federally registered investment advisers are subject to a SEC exam each year.

Stay tuned to RIA Compliance Consultants for further updates on this story.

Posted by Bryan Hill
Labels: SEC, SEC Inspection, SRO