More On Legal & Compliancefrom The Advisor's Professional Library
- The Custody Rule and its Ramifications When an RIA takes custody of a clients funds or securities, risk to that individual increases dramatically. Rule 206(4)-2 under the Investment Advisers Act (better known as the Custody Rule), was passed to protect clients from unscrupulous investors.
- Dealings With Qualified Clients and Accredited Investors Depending upon an RIAs business model and investment strategies, it may be important to identify “qualified clients” and “accredited investors.” The Dodd-Frank Act authorized the SEC to change which clients are defined by those terms.
While the obvious "big challenge" the agency faces is implementing the scads of changes set out in the reform bill, the SEC is already busy setting up new offices at the securities regulator to police the market. The SEC announced on July 16 that the SEC will create three new specialized units within the agency's Division of Corporation Finance--the division that reviews public company filings--to focus on large financial institutions, asset-backed securities and other structured products, and securities offering trends.