Last week we discussed the Lucia matter and the parameters it added for investment advisers to consider prior to utilizing performance advertisements. Today we will discuss two more administrative proceedings involving performance advertisements and the practical implications which can be taken from these cases. The matter of Virtus Investment Advisers revolved around one…
Pursuant to Section 206 of the Investment Advisers Act of 1940 (“Advisers Act”) and Rule 206(4)-1, it is considered fraud for a registered investment adviser to publish, circulate, or distribute any advertisement which contains any untrue statement of material fact or which is false or misleading. One type of advertising…
Investment advisers continue to get into regulatory trouble when it comes to failing to disclose conflicts of interest and related party transactions as required by both federal and state investment adviser law. Recently, the Securities and Exchange Commission (SEC) initiated proceedings against Fenway Partners, a New York-based registered investment adviser…
In a letter dated December 11, 2015, the Texas State Securities Board (“Board”) granted a no-action request by Managed Financial Service Corporation, Inc. (“MFSC”) that paves the way for a retiring investment adviser representative to receive continuing compensation after retirement. The Board confirmed that it would not commence or seek…
Although there is currently no requirement that registered investment advisers maintain anti-money laundering programs pursuant to the USA PATRIOT Act, the Bank Secrecy Act (“BSA”) or any of the other acts that apply to certain financial institutions, that may change if the Treasury Department’s Financial Crimes and Enforcement Network (“FinCEN”)…
On April 13, 2015, the North American Securities Administrators Association (“NASAA”) adopted a model rule concerning business continuity and succession planning for investment advisers. The model rule is intended as guidance for state-registered investment advisers to determine how to develop succession planning policies and procedures. Investment advisers without business continuity…
In August of this year the Securities and Exchange Commission (“SEC”) settled an administrative proceeding that related to statements an investment adviser made during the SEC’s on-site examination. The adviser at issue, Parallax Capital Partners, LLC, is a registered investment adviser that focuses primarily on mortgage-backed bonds and other similar…
On September 22, the Securities and Exchange Commission (“SEC”) announced an important cybersecurity enforcement action that has broad implications to registered investment advisers. In a Settlement Order, the SEC found R.T. Jones Capital Equities Management, a St. Louis-based investment adviser, “willfully violated” the Safeguards Rule. From September 2009 through July…
The Investment Advisers Act of 1940 requires that investment advisers exercise a fiduciary responsibility toward clients. Traditionally, this duty extends to protecting clients against fraud and abuse. But how does this fiduciary duty change when faced with an aging population? It’s no secret: the average age of the American population…
Parker MacIntyre attorneys Steve Parker and Bryan Gort attended the 2015 annual conference of the North American Securities Administrators Association (NASAA) held last week in San Juan, Puerto Rico. As usual, the conference provided valuable guidance and updated information on areas of importance to state-registered investment advisers, as well as…