More On Legal & Compliancefrom The Advisor's Professional Library
- Using Solicitors to Attract Clients Rule 206(4)-3 under the Investment Advisors Act establishes requirements governing cash payments to solicitors. The rule permits payment of cash referral fees to individuals and companies recommending clients to an RIA, but requires four conditions are first satisfied.
- Client Communication and Miscommunication RIA policies and procedures must specify what type of communications should be retained. The safest course of action is for RIAs to retain all communicationsto clients, from clients, and about client accounts. To comply with fiduciary obligations, communications must be thorough and not mislead.
The Securities and Exchange Commission has named Adam Storch to the newly created position of managing executive of its Division of Enforcement. In his new role, Storch will act as the Division's chief operating officer.
Storch will report to Robert Khuzami, the Director of the Division, who created the position as part of a restructuring he announced earlier this year, according to the SEC. The SEC says that Storch will be responsible for project management and workflow for various infrastructure and operational aspects of the Division, including budget, information technology, and administrative services. In addition, "he will oversee the workflow and process associated with the collection and distribution of Fair Funds to harmed investors," the SEC says. Along with Lorin Reisner, the Deputy Director of the Division of Enforcement, "Storch will supervise the Office of Market Intelligence, improving the collection, analysis, risk-weighing, triage, referral, and monitoring of the hundreds of thousands of tips, complaints and referrals that the agency receives each year," the SEC says.
Storch joins the SEC from Goldman Sachs & Co., where he was VP in the Business Intelligence Group.
The restructuring of the Enforcement Division seeks to reduce bureaucracy and expedite the enforcement process by eliminating unnecessary process, streamlining procedures, and rebalancing the Division's investigative staff by reducing management levels and reassigning those experienced personnel to full-time investigative work, the SEC says. In addition, the SEC says the "newly-structured Division will include specialized units that will enable staff in those units to develop expertise in priority areas and utilize that expertise to help detect earlier and more often the patterns, links, trends, and motives connected to fraud and wrongdoing."