Advisers

FYI: Best Execution Risk Alert

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FYI: Yesterday OCIE issued a Risk Alert listing examples of many of the most common best execution (BE) deficiencies encountered in IA examinations, including: • Not performing BE reviews. IAs are expected to demonstrate through documentation that they periodically and systematically evaluate the performance of the BDs used to execute client transactions. • Not considering materially relevant factors during BE reviews. Qualitative factors (responsiveness, financial responsibility, etc.) as well as quantitative factors (commission rate, etc.) should be considered. As relevant, input from the IA’s traders and portfolio managers should be solicited. • Not seeking comparisons from other BDs. Comparisons should […]

Advisers

FYI: 2018 Compliance Testing Survey

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FYI: The IAA has released the results of its 2018 compliance testing survey. Areas surveyed this year included: • Fees & Expenses • Investment Mandates • Data Analytics • Custody • Best Execution • Soft Dollars • Advertising/Social Media • Individual Clients • Cryptocurrency Trend updates were also included in these areas: • Cybersecurity • Pay-to-Play • Form ADV • “Hot” Compliance Topics For the 5th year in a row, cybersecurity was named by survey respondents (81%) as the hottest compliance topic. And despite the recent focus on crypto, virtually all respondents said they do not trade in crypto-assets. A […]

Funds

FYI: New SEC Fund Disclosure Website

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FYI: The Division of Investment Management has launched a new page on the SEC’s website aggregating and simplifying access to certain disclosure information relating to funds. Currently, the page includes 3 main sections: 1. Fund Disclosure at a Glance – This section is aimed at the general public as well as industry participants, explaining briefly what the Disclosure Review and Accounting Office (DRAO) does and how to contact them with questions about fund disclosure information. 2. Accounting and Disclosure Information (ADI) – This section is intended to aid practitioners and others who are interested in the law and interpretations concerning […]