ComplianceAlert

New Internal Control Requirements for CPOs

Earlier this month, the NFA issued Interpretive Notice 9074 (the “Notice”) in relation to NFA Compliance Rule 2-9 for CPOs. The Notice pertains to CPOs with control over customer funds and addresses how firms should manage employees and supervise third parties in order to meet the supervisory obligations under the Compliance Rule. The NFA recognizes…

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ComplianceAlert

NFA Updates Cybersecurity Components of Compliance Rule 2-9

On January 7, 2019, the NFA issued Notice I-19-01 to update its original interpretive notice regarding cybersecurity. The new amendment clarifies certain requirements for a CPO’s and CTA’s Information Systems Security Program (ISSP). Most firms adopted the original requirements in March 2016. Since then, the original NFA notice has been a best practice guide for…

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ComplianceAlert

“Not Recently Examined” Firms a Focus for SEC in 2019

On December 20, 2018, the Office of Compliance Inspections and Examinations (“OCIE”) released its 2019 Examination Priorities Letter (the “Letter”). The release came on the heels of a flurry of last minute activity by the SEC before both the holiday season and the impending government shutdown. OCIE was late to issue its 2018 exam priorities…

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ComplianceAlert

OCIE Offers Insight on E-Communications

The Office of Compliance Inspections and Examinations (OCIE) issued a new National Exam Program Risk Alert (the “Alert”) last week on electronic messaging. OCIE conducted an undisclosed number of limited scope examinations of investment advisers to determine the risks and controls surrounding the use of electronic messaging by advisers and their personnel. The examinations purposefully…

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ComplianceAlert

Exam Initiative Underway by OCIE

Last week, the Office of Compliance Inspections and Examinations (OCIE) announced new targeted exams of registered investment companies and advisers with specific types of investment activity. Specifically, exams will cover the following types of funds and activities: Index funds with custom indices Small ETFs and ETFs with limited trading volume Mutual funds investing in securitized…

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