Division Risk Alert: Code of Ethics

Division Risk Alert: Code of Ethics

14 June 2022

Main Contributor: Gretchen Sturdivan, CSCP Creative Director & Client Service Manager Background The Division of Exams (“EXAMS”) has found notable deficiencies in relation to Section 204A of the Advisers Act and the Code of Ethics Rule 204A-1, which they lay out in a recent Risk Alert. We may all associate the Code of Ethics withRead More »

2022 Division Exam Priorities

2022 Division Exam Priorities

03 May 2022

Main Contributor: Gretchen Sturdivan, CSCP Creative Director & Client Service Manager Hindsight is 2021 It remains an annual highlight to read through the Division of Examinations’ (“Division”) Exam priorities, as we comb through what they deem to be significant focus areas and adjust our compliance programs accordingly. The Division provides Risk Alerts throughout the yearRead More »

The SEC Proposes Two New Rules

The SEC Proposes Two New Rules

08 April 2022

Main Contributor: Katie Mogan, IACCP® Vice President, Senior Compliance Consultant   Background The first quarter is always a busy time for investment advisors.  This year, the SEC was busy too, releasing two new proposed rules, Cybersecurity Risk Management  and Requirements for Private Fund Advisers . It’s important to remember that a proposed rule can takeRead More »

Annual ADV Amendment Prep

Annual ADV Amendment Prep

08 March 2022

Main Contributor: Katie Mogan, IACCP® Vice President, Senior Compliance Consultant Introduction It’s that time of year again. Annual ADV amendments must be filed by March 31st for advisors with a fiscal year end of December 31st.  Hopefully you have started a work-in-progress (“WIP”) version of your ADV Part 2A with notes to help you withRead More »

SEC Risk Alert Digital Asset Securities

SEC Risk Alert Digital Asset Securities

01 March 2022

Main Contributor: Katie Mogan, IACCP® Vice President, Senior Compliance Consultant Background  I don’t know about you, but we are hearing and seeing cryptocurrency everywhere.  In this article we are tackling the SEC’s Digital Assets Risk Alert from February 2021. While we are experts in the SEC-registered investment advisor space, we are not experts in digitalRead More »

Performance Fees Increased Thresholds

Performance Fees Increased Thresholds

14 February 2022

Main Contributor: Zachary Fenno, CSCP, Compliance Manager Qualified Client Threshold The SEC scrutinizes performance fees heavily, so it is important to stay abreast of new regulations surrounding when advisors can charge performance fees. The Advisor’s Act prohibits registered advisors from charging a performance-based fee unless the client meets the definition of a “Qualified Client.” OriginallyRead More »

SEC Risk Alert Fee Calculations

SEC Risk Alert Fee Calculations

08 February 2022

Main Contributor: Gretchen Sturdivan, CSCP Creative Director & Client Service Manager Introduction The Division of Examinations (the “Division”) continues to focus on retail clients in their most recent Risk Alert, which highlights deficiencies around advisory fee billing practices. The deficiencies the Division notes often result in financial harm to the client and do not upholdRead More »

2022 RIA Compliance Calendar & Filing Deadlines

2022 RIA Compliance Calendar & Filing Deadlines

20 January 2022

2022 SEC Regulatory Deadlines for Investment Advisers The filing deadlines are listed below in chronological order, with additional details of RIA form and filing obligations toward the end. **NOTE: This resource does not address all potential regulatory reporting and compliance obligations. It is based on a fiscal year end of December 31st. If your firmRead More »

Compliant Advertising –  Breaking It Down (Again) Part 5: Everything Else  (Third Party Ratings, ADV, B&R, No-Action Letters, Next Steps)

Compliant Advertising – Breaking It Down (Again) Part 5: Everything Else (Third Party Ratings, ADV, B&R, No-Action Letters, Next Steps)

10 January 2022

Main Contributor: Elizabeth Cope, CPA, CSCP, CIPM CEO & Lead Consultant Background At this point we have covered The Definition of an Advertisement, where we summarize the amended Marketing Rule’s definitions of an advertisement; specifically the elements covered under Prong 1 and Prong 2 of the definition. We follow this with part two of our series,Read More »

Principal, Agency, and Internal Cross Transactions, Oh My!

Principal, Agency, and Internal Cross Transactions, Oh My!

10 December 2021

Main Contributor: Elizabeth Cope, CPA, CSCP, CIPM CEO & Lead Consultant   Background Before you read the title and stop because you don’t think this applies to you, keep in mind that claiming NOT to engage in the aforementioned practices, is one of the issues the SEC has found in examinations. If it is your policyRead More »

SEC Risk Alert: Wrap Fee Programs

SEC Risk Alert: Wrap Fee Programs

01 November 2021

Main Contributor: Katie Mogan, IACCP® Vice President, Senior Compliance Consultant Introduction On July 21, 2021, the SEC released a Risk Alert focusing on examinations of wrap sponsors and wrap advisors. After examining over 100 advisors associated with wrap programs, the SEC found compliance concerns and identified areas where advisors needed to make improvements. The focusRead More »

Continuing Education Requirements For Investment Advisor Representatives

Continuing Education Requirements For Investment Advisor Representatives

19 October 2021

Main Contributor: Zachary Fenno, CSCP, Compliance Manager   In November 2020 the North American Securities Administrators Association (“NASAA”) adopted a Model Rule, setting guideline requirements for investment advisor representatives (“IARs”) registered with investment advisory firms to complete continuing education requirements in order to maintain licenses in jurisdictions that adopt the rule. This will apply to bothRead More »

Compliant Advertising –  Breaking It Down (Again) Part 4: Performance

Compliant Advertising – Breaking It Down (Again) Part 4: Performance

30 September 2021

Main Contributor: Elizabeth Cope, CPA, CSCP, CIPM CEO & Lead Consultant   Background Did you know the old Advertising Rule NEVER addressed performance advertising and for years advisers relied primarily on the Clover no-action letter, which was drafted in 1986?  The addition of requirements around performance advertising in the updated Marketing Rule is a necessary addition,Read More »

Compliant Advertising –  Breaking It Down (Again) Part 3: Testimonials and Endorsements

Compliant Advertising – Breaking It Down (Again) Part 3: Testimonials and Endorsements

31 August 2021

Main Contributor: Elizabeth Cope, CPA, CSCP, CIPM CEO & Lead Consultant This is the third article in our series to breakdown the updated Marketing Rule.  If you have not been following us, we highly suggest you start with the first in our series, The Definition of an Advertisement, where we summarized the amended Marketing Rule’s definitionsRead More »

Form D and Blue Sky Filings

Form D and Blue Sky Filings

05 August 2021

Main Contributor: Zachary Fenno, CSCP, Compliance Manager Introduction Private fund advisors have unique filing requirements, such as Form D, and Blue Sky Filings. In this article we are going to explain the two filings and the two exemptions commonly used by private fund advisors. Purpose of Form D and Blue Sky The Form D providesRead More »

Form CRS: Ongoing Obligations

Form CRS: Ongoing Obligations

21 July 2021

Main Contributor: Katie Mogan, IACCP® Vice President, Senior Compliance Consultant The one-year anniversary of Form CRS has come and gone, yet there are still questions about delivery requirements and annual updates.  First and foremost, there is NO annual update requirement. However, there are a few important triggers with re-filing your Form CRS, as well asRead More »

ESG Investing Risks & Compliance Implications

ESG Investing Risks & Compliance Implications

02 July 2021

Main Contributor: Gretchen Sturdivan, Creative Director & Client Service Manager Approaching Sustainability The SEC Division of Examinations published a Risk Alert on April 9, 2021, as a result of their exam findings with firms who offer Environmental, Social, Governance (“ESG”) products and services. ESG investing has been an Examination Priority for the SEC for theRead More »

Compliant Advertising –  Breaking It Down (Again) Part 2: General Prohibitions

Compliant Advertising – Breaking It Down (Again) Part 2: General Prohibitions

02 June 2021

Main Contributor: Katie Mogan, IACCP® Vice President, Senior Compliance Consultant Background This article follows the first in our series, The Definition of an Advertisement, where we summarized the amended Marketing Rule’s definitions of an advertisement; specifically the elements covered under Prong 1 and Prong 2 of the definition. Part Two of our series will focusRead More »

2021 Exam Priorities: Discussion for Registered Investment Advisors

2021 Exam Priorities: Discussion for Registered Investment Advisors

06 April 2021

Main Contributor: Katie Mogan, IACCP® Vice President, Senior Compliance Consultant   We finally have the 2021 Examination Priorities (“Priorities”) from the SEC, albeit later than previous years. You can read the release here. The Priorities for 2021 are strikingly similar to those of previous years, as noted below: Retail Investors, Including Seniors and Individuals SavingRead More »

Compliant Advertising –  Breaking It Down (Again) Part 1: The Definition  of an Advertisement

Compliant Advertising – Breaking It Down (Again) Part 1: The Definition of an Advertisement

01 March 2021

Main Contributor: Katie Mogan, IACCP® Vice President, Senior Compliance Consultant   Background The SEC proposed and adopted the new Marketing Rule, (the “Rule”) which will eventually replace the current Advertising Rule (Rule 206(4)-1, originally adopted in 1961) and the Solicitation Rule (Rule 206(4)-3, originally adopted in 1979). The Rule is a complete rewrite of theRead More »

SEC Risk Alert Large Trader Obligations (Form 13H)

SEC Risk Alert Large Trader Obligations (Form 13H)

26 January 2021

Main Contributor: Katie Mogan, IACCP® Vice President, Senior Compliance Consultant   On December 16, 2020 the SEC released a risk alert addressing observations from examinations for adviser’s compliance with Rule 13h-1, also known as the Large Trader Rule.. This article will cover investment advisers’ obligations under Rule 13h-1 and helpful guidance to make it easier.Read More »

2021 RIA Compliance Calendar & Filing Deadlines

2021 RIA Compliance Calendar & Filing Deadlines

05 January 2021

Don’t miss a compliance deadline this year!  We have put together a calendar to help you keep track of regulatory filing deadlines for 2021.  You might want to bookmark this one and also make sure you are on our deadline reminder list!   2021 SEC Regulatory Deadlines for Investment Advisers The filing deadlines are listedRead More »

OCIE Observations: Compliance Programs

OCIE Observations: Compliance Programs

04 January 2021

Main Contributor: Katie Mogan, IACCP® Vice President, Senior Compliance Consultant   The SEC Risk Alerts keep coming, this time with exam observations regarding investment advisors’ Compliance Programs. According to OCIE, the most common exam deficiencies arise from issues with Rule 206-4(7), known as “the Compliance Rule.” Rule 206(4)-7 requires investment advisors to have policies andRead More »

New York State Now Requires Investment Advisor Representatives to Register

New York State Now Requires Investment Advisor Representatives to Register

17 December 2020

Main Contributor: Katie Mogan, IACCP® Vice President, Senior Compliance Consultant   Effective February 1, 2021, New York state will require Investment Advisor Representatives (“IARs”) to register with the state via the CRS/IARD system. You can read the updated NY regulation here. Historically, New York has been one of the few states to not require IARsRead More »

OCIE: Exam Observations

OCIE: Exam Observations

04 December 2020

Main Contributor: Katie Mogan, IACCP® Vice President, Senior Compliance Consultant   The SEC has blessed us once again with another Risk Alert.  This time, they are providing us with a summary of their findings from a series of focused exams of advisors with branch offices. We intentionally left out the term “branch office” in theRead More »

SEC Risk Alert: Safeguarding Against Credential Compromise

SEC Risk Alert: Safeguarding Against Credential Compromise

30 October 2020

Main Contributor: Gretchen Sturdivan, Creative Director & Client Service Manager   On September 15th, the SEC issued a Risk Alert to address a method of cyber-attack that is more sophisticated yet increasingly accessible to attackers: “credential stuffing.” We’re getting close to Thanksgiving, but that’s not the direction the SEC is going. This method of cyber-attackRead More »

SEC Amendments to the Accredited Investor Definition

SEC Amendments to the Accredited Investor Definition

24 September 2020

Main Contributor: Katie Mogan, IACCP® Vice President, Senior Compliance Consultant   In August of this year, the SEC released an amendment to the “accredited investor” definition. What is an Accredited Investor? Certain qualifications must be met in order to invest in private placements or private funds. One qualification is being an “accredited investor.” An accreditedRead More »

COVID-19 Compliance Risks and Considerations for Investment Advisers

COVID-19 Compliance Risks and Considerations for Investment Advisers

01 September 2020

Main Contributor: Elizabeth Cope, CPA, CSCP, CIPM, CEO & Lead Consultant   On August 12th the SEC issued a Risk Alert outlining observations from exams and risks in light of the COVID-19 work from home environment. The Commission outlined six (6) areas of concern for firms to review and adjust policies and procedures as necessary,Read More »

SEC’s Ransomware Alert

SEC’s Ransomware Alert

04 August 2020

Main Contributor: Elizabeth Cope, CPA, CSCP, CIPM, CEO & Lead Consultant   On July 10th the SEC issued a risk alert focusing on ransomware and the importance of generating awareness within advisory firms of current threats.  The SEC is encouraging registrants to monitor alerts provided by the Department of Homeland Security Cybersecurity and Infrastructure SecurityRead More »

SEC Proposed Changes on 13F

SEC Proposed Changes on 13F

19 July 2020

Main Contributor: Katie Mogan, IACCP® Vice President, Senior Compliance Consultant   On July 10th, the SEC released a proposal to amend reporting requirements of Form 13F to update the reporting threshold which has not been adjusted in over 40 years. What is 13F? Section 13F of the Securities and Exchange Act requires registered investment advisersRead More »

Exam Findings for Private Funds

Exam Findings for Private Funds

06 July 2020

Main Contributor: Elizabeth Cope, CPA, CSCP, CIPM, CEO & Lead Consultant   The SEC issued a risk alert on June 23rd that provides a summary of the results the staff discovered when conducting exams of investment advisors that manage private funds. If you are an advisor to private funds (all types including private equity) orRead More »

Compliance During the Pandemic

Compliance During the Pandemic

02 June 2020

Main Contributor: Elizabeth Cope, CPA, CSCP, CIPM, CEO & Lead Consultant   We have settled into work from home life and found a (somewhat) new normal of work during the pandemic. When the dust settles, we expect the SEC to focus on areas such as business continuity and supervision of employees during the pandemic. WeRead More »

SEC Risk Alert: Form CRS

SEC Risk Alert: Form CRS

08 May 2020

Main Contributor: Katie Mogan, IACCP® Vice President, Senior Compliance Consultant   SEC Risk Alert: Form CRS On April 7, 2020, the Office of Compliance Inspections and Examinations (“OCIE”) issued a risk alert to let advisors and broker-dealers know that, regardless of COVID-19,  it’s business as usual at the SEC and firms must continue to meetRead More »

How are you Handling the Pandemic?

How are you Handling the Pandemic?

23 March 2020

Main Contributor: Elizabeth Cope, CPA, CSCP, CIPM, CEO & Lead Consultant   It didn’t take long for advisors to start receiving requests from underlying managers, investors and even the SEC on how they were responding to the pandemic. Areas being addressed, include, but are not limited to: A copy of your firm’s Business Continuity PlanRead More »

Compliant Advertising: Breaking it Down – Part 4: Performance

Compliant Advertising: Breaking it Down – Part 4: Performance

06 March 2020

Main Contributor: Elizabeth Cope, CPA, CSCP, CIPM, CEO & Lead Consultant   Review of Part 1: The Foundation In the first article of this series, we discussed the foundational information you need to know to ensure your marketing and advertising materials are in compliance with the SEC’s rules and regulations.  We helped you clearly understand:Read More »

2020 SEC Exam Priorities

2020 SEC Exam Priorities

29 January 2020

Main Contributor: Katie Mogan, IACCP® Vice President, Senior Compliance Consultant   I can’t think of a better way to start off the year than by reading the SEC’s Exam Priorities for 2020.  Okay, I’m being a bit facetious.  But in all honesty, I do look forward to this publication. It is a great compliance toolRead More »

New SEC Disclosure Form

New SEC Disclosure Form

03 January 2020

Main Contributor: Elizabeth Cope, CPA, CSCP, CIPM, CEO & Lead Consultant   Have you heard? There is a new form in town. It goes by many names…it is referred to as the Client Relationship Form, Form CRS, or even ADV Part 3. The intent of this new form is to provide your Retail Investors withRead More »

2020 RIA Compliance Calendar & Filing Deadlines

2020 RIA Compliance Calendar & Filing Deadlines

19 December 2019

The purpose of this compliance calendar is to help you keep track of regulatory filing deadlines for 2020.  To receive reminders, make sure you join our mailing list! 2020 SEC Regulatory Deadlines for Investment Advisers The filing deadlines are listed below in chronological order, with additional details of RIA form and filing obligations toward the end.Read More »

Compliant Advertising: Breaking it Down – Part 3: Past Specific Recommendations

Compliant Advertising: Breaking it Down – Part 3: Past Specific Recommendations

27 November 2019

Main Contributor: Elizabeth Cope, CPA, CSCP, CIPM, CEO & Lead Consultant   Review of Part 1: The Foundation In the first article of this series, we discussed the foundational information you need to know to ensure your marketing and advertising materials are in compliance with the SEC’s rules and regulations.  We helped you clearly understand:Read More »

SEC Proxy Voting Guidance

SEC Proxy Voting Guidance

27 November 2019

Main Contributor: Katie Mogan, IACCP® Vice President, Senior Compliance Consultant   After years of research, OCIE exam findings, and roundtable discussions, the SEC has issued guidance on proxy voting in the form of a Question and Response (“Q&R”). You can find the Q&R guidance here. The responsibilities of proxy voting can be an administrative burdenRead More »