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:
The North American Securities Administrators Association (“NASAA”) recently released its 2023 Investment Adviser Coordinated Exam findings. The report provides valuable insights and empirical data with respect to the most common deficiencies found during 683 routine examinations of state-registered investment advisers located throughout the U.S. and conducted from January 1 to July 31, 2023.
The Colorado Division of Securities recently issued its 2023 examination priorities for state-registered investment adviser firms registered with the State of Colorado.
On March 3, 2021, the Division of Examinations (formerly known as the “Office of Compliance Inspections and Examinations”) of the U.S. Securities and Exchange Commission (“SEC”) released its 2021 Examination Priorities, an annual report discussing the Division of Examination’s areas of focus including investment advisers registered with the SEC (“RIAs”) for the coming year. In this report, the Division of Examinations (“Division”) noted that it intends to continue to prioritize examinations of SEC registered investment advisers, broker-dealers, and dually registered or affiliated firms, particularly those that have never been examined or have not been examined recently. In doing so, the Division will emphasize protection of retail investors and those saving for retirement.
SEC Risk Alert
On June 23, 2020, the Office of Compliance Inspections and Examinations (“OCIE”) of the U.S. Securities and Exchange Commission (“SEC”) released a Risk Alert about its assessment of the compliance practices of SEC registered investment advisers that manage private equity funds or hedge funds (“private fund advisers”). In its Risk Alert, the SEC noted that over 36% of SEC registered investment advisers manage private funds, which represent a significant area of investment for pensions, charities, endowments, and others. Click here to read the SEC’s Risk Alert for Private Funds.
On January 7, 2020, the Securities and Exchange Commission (“SEC”) Office of Compliance Inspections and Examinations (“OCIE”) released its 2020 Examinations Priorities for SEC registered investment advisers. After completing over 3,089 investment adviser examinations in 2019, the SEC outlined several themes for the focus of investment adviser examinations which include the following:
On December 20, 2018, the Office of Compliance Inspections and Examination (“OCIE”) of the U.S. Securities Exchange Commission (“SEC”) released its 2019 Examinations Priorities for SEC registered investment advisers. After completing over 3,150 investment adviser examinations in 2018, a 10 percent increase over 2017, the SEC outlined several themes for the focus of investment adviser examinations which include the following:
