On July 23, 2019 the Office of Compliance Inspections and Examination’s (“OCIE”) of the U.S. Securities and Exchange Commission (“SEC”) released a Risk Alert about its assessment of the oversight practices of SEC-registered investment advisers who employ or employed individuals with disciplinary histories. Of the over 50 advisers that were examined, nearly all of the examined advisers received deficiency letters. The OCIE exams did not focus solely on supervisory practices as they relate to the individuals with prior disciplinary histories. Instead, OCIE reviewed the advisers’ supervisory practices firm-wide. OCIE’s findings relate to all investment advisers regardless of whether they have someone with a disciplinary history. The deficiencies identified related to compliance and disclosure issues, including undisclosed conflicts of interest.
Form CRS Relationship Summary/ADV Part 3 FAQ Page Live
July 23, 2019
On June 5, 2019 the U.S. Securities and Exchange Commission (SEC) voted on and approved package of rulemakings and interpretations, that includes the new Form CRS Relationship Summary, also known as the ADV Part 3. The ADV Part 3 is designed to be a short and accessible disclosure for retail investors that helps them compare information about firms’ investment advisory offerings. To help investment advisers understand what will be required by the Form CRS Relationship Summary/ADV Part 3, RIA Compliance Consultants created a new webpage, Form ADV Part 3 FAQs. The page features 25 questions with detailed answers about what will be required by investment advisers on the Form CRS Relationship Summary/ADV Part 3.
Form CRS Relationship Summary – ADV Part 3
June 11, 2019
On June 5, 2019 the U.S. Securities and Exchange Commission (SEC) voted on and approved a CRS Relationship Summary also known as the ADV Part 3. The ADV Part 3 is designed to be a short and accessible disclosure for retail investors that helps them compare information about firms’ investment advisory offerings. The relationship summary is intended to inform retail investors about:
On June 5, 2019 the U.S. Securities and Exchange Commission (SEC) voted on and approved four rules relating to the proposed standards of conduct rulemaking package that was originally proposed in April 2018. The approved rulemaking package includes:
NASAA Cybersecurity Model Rule Package
May 31, 2019
On May 21, 2019, the North American Securities Administrators Association (NASAA) released a model cybersecurity rule package. NASAA’s proposed rule would require investment advisers to adopt policies and procedures regarding information security and to deliver annually its privacy policy to clients.
SEC Risk Alert – Compliance Issues Related to Regulation S-P – Privacy Notices and Safeguard Policies
May 07, 2019
On April 16, 2019, the United States Securities and Exchange Commission’s (SEC) Office of Compliance Inspections and Examinations (OCIE) issued a risk alert about “Compliance Issues Related to Regulation S-P – Privacy Notices and Safeguard Policies” to encourage investment adviser firms to review their written policies and procedures to, “ensure compliance with the relevant regulatory requirements.”
Regulatory Reminder for State Registered Investment Advisers – Submission of Annual Financial Statements in Certain States
March 15, 2019
As your state registered investment adviser firm completes its Form ADV Annual Amendment, it’s important not to forget that many state securities regulators also require a state registered investment adviser firm to submit annual financial statements and/or other documents directly to the state securities regulator (outside of the IARD/CRD system).
Cybersecurity Survey – Nebraska Registered Investment Advisers
January 22, 2019
On December 3, 2018 the Nebraska Department of Banking and Finance (NDBF) released their 2018 Cybersecurity Survey of Nebraska-Registered Investment Advisers. NDBF surveyed fifty-seven Nebraska registered investment advisers. The survey focused on devices used in advisory activities, Wi-Fi access points, passwords, encryption policies, and anti-virus/anti-malware services. The full report can be viewed here.
2019 SEC Examination Priorities
December 27, 2018
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:
