ComplianceAlert

SEC’s Marketing Exams Reveal Compliance Shortcomings

On April 17, 2024, the SEC’s Division of Examinations issued a Risk Alert (the “Alert”) on its findings from adviser examinations conducted since the revised Rule 206(4)-1 (the “Marketing Rule”) compliance date. Firms were required to be in compliance as of November 4, 2022, and the SEC has actively been examining advisers for compliance since then. Several targeted exams or “sweeps” were conducted covering topics such as the substantiation of material facts in advertisements, use…

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ComplianceAlert

Firms on notice with early release of SEC’s exam priorities

Released earlier than expected, the SEC’s 2024 Examination Priorities report (“Exam Priorities”) from the Division of Examinations (“the Division”) was issued on October 16, 2023. In the past few years, the Exam Priorities report was not made public until Q1 and sometimes not until late Q1, which made the data several months stale. The Division stated that it wanted this report to coincide with the beginning of its fiscal year of October 1, which makes…

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ComplianceAlert

SEC’s New Private Fund Rules Alter Landscape (Video)

The private fund industry has a new compliance hurdle to reach with the SEC’s newly adopted Private Fund Rules (“the Rules”). On August 23, 2023, the Commission voted 3-2, along party lines, to adopt new rules (a total of five) under Section 211(h) of the Advisers Act. The SEC determined that new rules were needed for the private fund industry in order to address: Lack of transparency in private funds Conflicts of interest Lack of…

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ComplianceAlert

SEC reveals its examination strategy

The SEC recently released a Risk Alert (“the Alert”) from the Division of Examinations on how it goes about selecting firms for examination. This is a first of its kind Alert since traditionally the Staff has not released its examination strategy and registrant selection process. The Alert even includes a chart that shows the items on its initial document request letter to registered advisers. The goals of the Division of Examinations are to: Promote compliance…

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ComplianceAlert

SEC’s New Private Fund Rules Alter Landscape

The private fund industry has a new compliance hurdle to reach with the SEC’s newly adopted Private Fund Rules (“the Rules”). On August 23, 2023, the Commission voted 3-2, along party lines, to adopt new rules (a total of five) under Section 211(h) of the Advisers Act. The SEC determined that new rules were needed for the private fund industry in order to address: Lack of transparency in private funds Conflicts of interest Lack of…

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