NU Online News Service, May 26, 2004, 7:33 p.m. EDT – The U.S. Securities and Exchange Commission today voted unanimously to require investment advisors to beef up their codes of ethics.[@@]
The SEC changed Investment Advisers Act Rule 204A-1 and other rules to require advisors to adopt and enforce codes of ethics for their employees and other “supervised persons” by Jan. 7, 2005.
One section of an advisor’s code of ethics must establish standards of conduct for supervised persons that reflect the advisor’s fiduciary duties, the SEC says.
“Supervised persons will have to acknowledge, in writing, receipt of a copy of the code of ethics and any amendments,” the SEC says in a notice about the rule change.
The advisor’s code of ethics also will have to require supervised persons to comply with applicable federal securities laws and report any violations of the code to the advisor’s chief compliance officer.