Registration, Disclosure and Filing Requirements

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Private Equity Firm Charged with Failure to Disclose Accelerated Portfolio Monitoring Fees

Private Equity Firm Charged with Failure to Disclose Accelerated Portfolio Monitoring Fees WHAT HAPPENED? On December 21, 2017, the SEC charged a private equity fund adviser (“Respondent”) with failing to adequately disclose accelerated portfolio monitoring fees.  Between 2013 and 2015, Respondent accelerated the payment of future monitoring fees from [...]

SEC Modifies Final Rule for Form N-PORT

SEC Modifies Final Rule for Form N-PORT WHAT HAPPENED? The SEC has adopted a temporary final rule that will delay the compliance dates for filing a Form N-PORT.  The SEC made this modification in order to evaluate their data security practices for material, nonpublic information and uplift the EDGAR [...]

Adviser Charged with Defrauding Clients

Adviser Charged with Defrauding Clients WHAT HAPPENED? On December 11, 2017, the SEC charged a dually registered investment adviser and broker-dealer, and its principal (collectively, the “Defendant”), with defrauding its clients and receiving $780,000 in ill-gotten gains.  Over the course of several years, Defendant repeatedly purchased securities from underwriters [...]

Department of Labor Announces 18-Month Delay of the Fiduciary Rule

Department of Labor Announces 18-Month Delay of the Fiduciary Rule WHAT HAPPENED? The Department of Labor has announced that the applicability date of the Fiduciary Rule’s Best Interest Contract Exemption, the Principal Transactions Exemption and specific amendments to Prohibited Transaction Exemption 84-24 (PTE)s have been delayed from January 1, [...]

SEC Charges Unregistered Fund Manager

SEC Charges Unregistered Fund Manager WHAT HAPPENED? On October 26, 2017, the SEC charged an unregistered investment adviser and its principals (“collectively, the “Respondents”) with engaging a private fund it managed (the “Fund”) in conflicted transactions without providing disclosure to the investors. The conflicted transactions that Respondents performed includes [...]

House Panel Passes Bill to Repeal DOL Fiduciary Rule

House Panel Passes Bill to Repeal DOL Fiduciary Rule WHAT HAPPENED? On October 12, 2017, the House Financial Services Committee passed the Protecting Advice for Small Savers Act of 2017 (the “PASS Act”), which would repeal the DOL’s Fiduciary Rule.  This bill would keep fiduciary rulemaking under the SEC’s [...]

Reminder that the New Form ADV Rules Took Effect on October 1, 2017

Reminder that the New Form ADV Rules Took Effect on October 1, 2017 WHAT HAPPENED? On October 1, 2017, the amendments to Part 1A of Form ADV and the Investment Advisers Act of 1940 (the “Advisers Act”) took effect.  The amendments, which are described in a previous Flash Report, [...]

DOL Provides Conflict of Interest FAQs Around Fiduciary Rule

DOL Provides Conflict of Interest FAQs Around Fiduciary Rule WHAT HAPPENED? On August 3, 2017, the DOL released a conflict of interest FAQs to provide additional clarification around the Fiduciary Rule. In the FAQ, the DOL provides guidance regarding: Fiduciary status disclosures that must be provided by ERISA pension plan service providers [...]

Dual Registrant Fails to Disclose Conflict of Interest from Revenue Sharing

Dual Registrant Fails to Disclose Conflict of Interest from Revenue Sharing WHAT HAPPENED? On July 19, 2017, the SEC charged a dually-registered investment adviser and broker dealer (“Respondent”) for failing to disclose compensation received from a third-party broker-dealer (“Broker”). Starting in 2002, Respondent waived transaction fees it and Broker would otherwise charge [...]

Upcoming Amendments to Form ADV

Upcoming Amendments to Form ADV WHAT HAPPENED? The new ADV reporting requirements go into effect October 1, 2017. Under the revised Form ADV, advisers will: require investment advisers to disclose additional information about their separately management account (“SMA”) business; require investment advisers to report specific information on general business operations, [...]