More On Legal & Compliancefrom The Advisor's Professional Library
- Trading Practices and Errors When SEC-registered investment advisors conduct annual audits of firm policies and procedures, they should pay close attention to trading practices. Though usually not required to, state-registered advisors should look at their trading practices and revise policies that do not fully protect clients.
- Anti-Fraud Provisions of the Investment Advisers Act RIAs and IARs should view themselves as fiduciaries at all times, whether they meet the legal definition or not. Deviating from the fiduciary standard of full disclosure while courting clients may cause the advisor significant problems.
The Securities and Exchange Commission is now providing a ComplianceAlert letter to chief compliance officers of SEC-registered firms to help them learn more about the common deficiencies and weaknesses that the SEC examiners find during exams.
The ComplianceAlert letter, compiled by SEC staff, is available on the SEC Web site. According to the SEC, the letter summarizes select areas that SEC examiners have recently reviewed during examinations, describes issues that were found, and encourages firms to review compliance in these areas and implement improvements as appropriate. Additional ComplianceAlert letters will be made available on the SEC's Web site (www.sec.gov).
The first ComplianceAlert letter provides information concerning recent examination findings with respect to investment advisers' performance advertising and business continuity planning; with respect to broker/dealers' compliance with Regulation SHO; and sales of collateralized mortgage obligations, real estate investment trust products, and Section 529 College Savings Plans.