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April 29, 2003 at 08:00 PM
NEW YORK (HedgeWorld.com)–Responses to rules for investment advisers recently proposed by the U.S. Securities and Exchange Commission suggest that outside marketers are likely to be subject to compliance requirements, as well.
In a letter to the SEC dated April 18, the North American Securities Administrators Association recommended that proposed securities law compliance rules be extended to “finders” or “solicitors,” people who don’t work for an investment adviser but who solicit clients for it.
Solicitors are covered already by the Advisers Act, under a rule that makes the adviser responsible for ensuring the marketer is not statutorily disqualified, that there is a written marketing agreement and that both adviser and marketer disclose the arrangement to clients. The SEC proposals would add compliance requirements.
Under proposed regulation, registered investment advisers have to adopt and implement policies and procedures designed to prevent violation of securities laws as well as appoint a chief compliance officer Previous HedgeWorld Story. NASAA supports the proposal and wants state officials to adopt similar rules so that regulation will be uniform across states.
The letter suggests addressing marketing relationships and making them subject to the same compliance procedures. “It is logical that the compliance rules should extend to solicitors, inasmuch as the solicitation rule already requires similar oversight,” it states.
