The SEC’s Office of Compliance Inspections and Examinations (“OCIE”) identified the following five areas of compliance deficiencies or weaknesses frequently found during its staff’s examinations of SEC-registered investment advisers:
The SEC’s Office of Compliance Inspections and Examinations has published its examination priorities for 2017. The priorities focus on electronic investment advice, money market funds, and financial exploitation of senior investors. In addition, the priorities “reflect a continuing focus on … Continued
Because this year is a Leap Year, the deadline for filing your annual amendment is March 30th and not the usual March 31st. Also, once you are done with your annual amendment filing, you still have one additional “ADV” obligation … Continued
Congratulations to the team at Digital Compliance and the launch of their very first compliance app – CCO Companion. We are proud to be the sole content provider for all of CCO Companion’s original compliance material. We believe, and from early … Continued
With the SEC’s greater emphasis on risk-based exams, SEC examiners’ primary focus is on an adviser’s controls and procedures. As such, they will perform an evaluation of the effectiveness of those controls. Where those controls are found to be weak and ineffective, or … Continued
An investment adviser has a fiduciary duty to act in the best interests of its clients. A central tenant of this duty is full and fair disclosure of all material facts to clients. What you tell your clients about your … Continued
Investment advisers must be able to monitor what their supervised persons are saying about the firm in their social media posts and should be able to monitor what others are saying about the advisory firm.
Since most social media activity occurs off-site and through mobile phones, advisory firms need to have the capability of applying all their social media policies and procedures to mobile devices.
Advisory firms must be able to capture and archive the posts and tweets of their supervised persons. Firm’s also need to be able to conduct a key word search for problematic terms.
Social media posts are advertising. Any disclaimer that you would typically place on your advisory firm’s web site should also accompany any social media posts. Since the nature of social media is to allow third-parties to post comments, it is … Continued
Among top five social media issues for advisers . . . Written Policies & Procedures Advisory firms must develop a written policy and attendant procedures that outlines, at the very least: The types of social media platforms (e.g., Twitter, Linkedin, … Continued
Six good safeguarding tips: Shred financial documents and other printed personal material before discarding. Do not leave your laptop computer, iPad, iPhone or Blackberry in your car (or Starbucks) unattended. Do not leave a computer you are logged on to … Continued
The entire world puts in some work time over the weekend. Why can’t the IARD system be up and running? For that matter, it should be accessible 24/7. After all, it is a computer system. My computer works round the … Continued
“Forensic testing” is certainly the buzzword in compliance circles. Think CSI: Crime Scene Investigation. Essentially, an adviser should conduct some type of transactional or quality control tests that will assist the adviser in determining whether its activities are consistent with … Continued
Lest you think the SEC is not serious about holding individuals personally liable, here is an excerpt from a recent speech by Chairperson White: Individual Liability: Any discussion of strong enforcement tools must include a discussion of our priority of … Continued
No one wants to be a victim of a cybersecurity attack. But if you are an investment adviser and your clients’ personally identifiable information (PII) is hacked, you will be a victim and, in the view of the regulators, you might just … Continued
The SEC recently conducted examinations of around 20 SEC-registered investment advisers and investment companies that outsourced their CCOs to unaffiliated third parties. The general takeaway is that outsourced CCOs sometimes were not knowledgeable about a firm’s business practices, did not have access to … Continued
On August 25, 2015, the Treasury Department’s Financial Crimes Enforcement Network (“FinCEN”) released proposed anti-money laundering (“AML”) regulations that would require investment advisers registered or required to register with the SEC to have written AML programs meeting certain minimum requirements … Continued
Recently an adviser asked if they still needed to keep trade confirmations since they were retained by their broker-dealer/custodian. I think an adviser must retain them in their books and records for three reasons: 1. The repository at the BD … Continued
Busy schedules and deadlines can make shortcuts seem appealing. But the work we complete and how we complete it matters.