Investment Adviser Regulation

In a speech on May 2, 2018 regarding the SEC’s recent proposed broker-dealer standard of conduct, Jay Clayton, Chair of the Securities and Exchange Commission (SEC), commented as follows on retail investor confusion over whether their financial service providers are investment advisers or broker-dealers:

“‘Financial advisor,’ ‘financial consultant,’‘wealth manager.’  Your financial professional may have

In the third release comprising part of the package of proposed rules and forms related to broker-dealers’ and investment advisers’ standards of conduct, the SEC proposed a new disclosure document to be used by registered broker-dealers, registered investment advisers, and dual registrants. The new client relationship summary, or “Form CRS,” would provide certain basic disclosures

On May 1, the SEC’s Division of Enforcement issued a series of frequently asked questions (FAQs) related to its Share Class Selection Disclosure Initiative (“SCSD Initiative”). The SCSD Initiative, which was originally announced February 12, 2018, provides that the Enforcement Division will agree to recommend to the Commission standardized, favorable settlement terms for investment advisers

According to the SEC, its April 18, 2018 release proposing an interpretation of the standard of conduct for investment advisers is intended to “reaffirm – and in some cases clarify – certain aspects of the fiduciary duty that an investment adviser owes to its clients under section 206” of the Investment Advisers Act of 1940.

At an open meeting held earlier today, the SEC voted 4-1 to propose a package of rules, forms, and guidance designed to define a new “best interest” standard of care for broker-dealers dealing with retail investors. The proposal would also require disclosure designed to help retail investors understand their relationship with their investment professionals, and

The SEC’s Office of Compliance Inspections and Examinations this week provided investment advisers with a summary of frequent compliance issues related to advisory fees and expenses that the staff is seeing in their examinations of registered investment advisers.

The Risk Alert, published April 12, 2018, is the latest in a series of similar alerts published

On January 18, 2018, the Small Business Credit Availability Act was introduced in the U.S. Senate and referred to the Committee on Banking, Housing, and Urban Affairs.  The Act would amend the Investment Company Act of 1940 to change certain requirements relating to the capital structure of business development companies (BDCs) and direct the Securities