Advisers

FYI: Risk Alert on Cash Solicitation Rule

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FYI: OCIE has issued a Risk Alert outlining common deficiencies found under the Cash Solicitation Rule (Rule 206(4)-3). Subject to few exceptions, the Cash Solicitation Rule applies whenever an IA pays cash to any solicitor with respect to solicitation activities. A “solicitor” is any person who, directly or indirectly, solicits any client for, or refers any client to, an IA. This covers the IA’s own personnel, as well as third-party solicitors. Personnel Solicitors. It is not uncommon for the rule to be missed altogether by IAs who use their own personnel (partners, officers, directors and employees of the IA or […]

Advisers

FYI: Themes Currently Guiding SEC Division of Investment Management

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FYI: In a speech to the ICI this week, the Director of the SEC’s Division of Investment Management outlined themes that are currently guiding the work of the Division, among them: — Improving the investor experience. This includes not only the on-going effort to improve the quality and usefulness of disclosure, but also how to facilitate modernizing the content, design and delivery of information provided to investors. — Modernizing key areas of the fund regulatory framework. One area specifically mentioned was the regulation of funds using derivatives. From the Director’s remarks, it is clear that the dialog about how to […]

Advisers

FYI: DOL Looks to Reconsider Fiduciary Rule in 2019

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FYI: The DOL’s latest regulatory agenda indicates that it is “considering regulatory options” in light of the Fifth Circuit court case that vacated the DOL Fiduciary Rule earlier this year. The agenda lists the timetable for a “Final Rule” on this as September 2019. Notably, September 2019 is also listed on the SEC’s current regulatory agenda as the timetable for “Final Action” on proposed Regulation Best Interest (as well as proposed Form CRS and the proposed Investment Adviser Standard of Conduct Interpretative Release). This coincidence of dates between the DOL and SEC may indicate that the agencies are attempting to […]

Advisers

FYI: No-Action Letter Allows Fund Boards to Rely on CCO Certifications

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FYI: The SEC’s Division of Investment Management has issued a no-action letter indicating that fund Boards can rely on quarterly written CCO certifications that transactions entered into in reliance on certain Exemptive Rules were effected in compliance with fund procedures, instead of the Boards having to make that determination themselves. According to the no-action letter, this is consistent with the Commission’s approach in adopting Rule 38a-1 and allows Boards to avoid duplicating certain functions commonly performed by or under the supervision of the CCO. Although this does not change the Board’s oversight role with respect to a fund’s overall compliance […]