No Surprise Exams for Most SEC Advisers

posted in: Custody | 0

Most of the investment advisers registered with the SEC who maintain custody of their clients’ investment funds aren’t subject to surprise annual examinations, according to a new federal report.

A study released last Monday by the Government Accountability Office found that, as of April 1, 4,446 of the 9,982 SEC-registered advisers had control over client money, amounting to more than $14 trillion in client assets.

Of those who had custody, 1,321 were subject to annual surprise examinations by independent public accountants. A total of 2,956 advisers with custody don’t have to undergo surprise exams.