Earlier this week, the U.S. Securities and Exchange Commission (“SEC”) approved a new rule “switching” regulatory responsibility from the SEC to state securities regulators for mid-size investment advisers (between $25 million and $100 million of what will now be known as “regulatory” assets under management).
Category Archives: SEC
The U.S. Securities and Exchange Commission (“SEC”) posted a link to the new rule release explaining the “switch” for mid-sized investment advisers ($25 million – $100 million of assets under management) from the SEC to state securities regulators. Click here to view the details of the switch.
The United States Securities and Exchange Commission (“SEC”) recently proposed a rule that would increase the dollar requirements that must be met before an investment adviser can charge performance based fees.
SEC May Delay “The Switch” to State Securities Regulators for Mid-Sized Investment Advisors
April 18, 2011
Under the Dodd-Frank Wall Street Reform and Consumer Protection Act (“Dodd-Frank Act”), an investment adviser who has between $25 million and $100 million in assets under management will have to withdraw its registration with the U.S. Securities and Exchange Commission (“SEC”) and register with one or more state securities regulators pursuant to the applicable state laws. When the Dodd-Frank Act was enacted on July 21, 2010, the deadline for an investment adviser to switch its registration was July 21, 2011, the one year anniversary of the bill’s enactment. However, in a letter dated April 8, 2011, Robert Plaze, the associate director of the SEC’s Division of Investment Management, stated that the deadline for “the Switch” is likely to be extended until the first quarter of 2012. Click here to view the full letter.
In March, the U.S. Securities and Exchange Commission (“SEC”) charged a Houston based investment adviser firm with fraudulent conduct related to offerings made to the clients of firm. The SEC alleged that the Houston based investment adviser advised clients to invest in promissory notes issued by a financial media company also owned by the owner of the investment adviser firm.
SEC Proposes Rule Prohibits Investment Advisers from Paying Risky Incentive-Based Compensation
March 06, 2011
Pursuant to Section 956 of the Dodd-Frank Wall Street Reform and Consumer Protection Act, the United States Securities and Exchange Commission (“SEC”) has proposed a rule that would require some financial institutions to disclose all incentive-based compensation arrangements and would prohibit those financial institutions from employing risky performance based compensation arrangements. Included under this rule, would be broker-dealers and investment advisers with more than $1 billion in assets under management.
SEC Proposes Rule Which Would Exclude Family Office from Investment Adviser Registration
October 14, 2010
The United States Securities and Exchange Commission (“SEC”) has proposed to adopt Rule 202(a)(11)(G)-1 under the Investment Advisers Act of 1940 which would exempt a “family office” from registration under the Investment Advisers Act.
SEC’s New Form ADV Part 2 Rule Now Effective
October 13, 2010
The U.S. Securities and Exchange Commissions (SEC) recently adopted amendments to the Form ADV Part 2 and related rules under the Investment Advisers Act of 1940. These changes are now effective. If your investment advisor has not already started the process of becoming familiar with the requirements of these changes, it should begin to do so in the very near future. New investment advisors requesting registration with the SEC will be required to submit the New Form ADV Part 2 after January 1, 2011. Existing SEC investment advisors will be required to submit the New Form ADV Part 2 with their first fiscal year end update after December 31, 2010. Since many investment advisors have a fiscal year end of December 31, this will mean that an investment advisor will need to file its New Form ADV Part 2 by March 31, 2011. While not all state securities regulators have determined what their plans are regarding the New Form ADV Part 2, most have indicated that they will eventually require the new format and many have indicated that they will currently accept it and will follow a timeline similar to the SEC.
The Switch from SEC to State Registration for Investment Advisers with Less than $100 Million of Assets under Management
August 31, 2010
The eligibility for registration as an investment adviser with the U.S. Securities and Exchange Commission (“SEC”) based upon the amount of assets under management will increase from the current minimum threshold of $25 million to a new threshold of $100 million pursuant to the Dodd-Frank Financial Reform Act, which passed on July 21, 2010. The Dodd-Frank Financial Reform Act included a provision affecting registered investment advisers eligible for SEC registration based upon the amount of assets under management and requiring that registered investment advisers with less than $100 million in assets under management register with state securities regulators rather than the SEC. It is estimated that as a result of this increased eligibility threshold, over 4,000 investment advisers currently registered with the SEC will need to register with the state securities regulator for each state where the investment adviser firm conducts investment advisory business and does not meet an exemption from the investment adviser registration requirements in that state.
The United States Securities and Exchange Commission (“SEC”) recently adopted the long-awaited amendments to Part 2 of Form ADV and related rules under the Investment Advisers Act of 1940. The Form ADV Part 2 amendments will require all investment advisors registered with the SEC to prepare and file plain English narrative brochures and supplements. SEC registered advisors will now be required to file these narrative brochures electronically through the IARD system in a text searchable PDF format. This filing process for the new Form ADV Part 2 is a task that state registered investment advisor firms have been required to do for sometime now but this will be a new process for SEC registered investment advisor firms.
