SEC Proposed Amendments to Form ADV and the Recordkeeping Rule in 2016 Explored
On May 20, 2015, the Securities and Exchange Commission (SEC) proposed amendments to Form ADV, Rule 204-2 (Recordkeeping Rule), and certain other rules under the Investment Advisers Act of 1940 (Advisers Act)
The amendments require investment advisers to provide additional information regarding Separately Managed Accounts (SMA), additional materials regarding the calculation and distribution of performance information, required identification of any custodians holding 10% or more of the investment adviser's SMA RAUM, and permit the 'umbrella registration' regime under which private fund advisers operating as a single advisory business may register with the SEC using one Form ADV. Concurrent to this, amendment of the U.S. Investment Company Act of 1940 to modernize the reporting and disclosure of information by registered investment companies.
In this two-hour LIVE Webcast, The Knowledge Group assembled a panel of key thought leaders and practitioners with in-depth knowledge of the laws and regulations governing investment advisers to provide an overview and discussion of the SEC Proposed Amendments to Form ADV and the Recordkeeping Rule in 2016. Speakers will also share the best practices in addressing the latest challenges of the proposed amendments.
Some of the major topics that will be covered in this course are:
- Form ADV and Recordkeeping Rule: An Overview
- Form ADV Proposed Clarifications, and Technical and Other Amendments
- Proposed Amendments to Books and Records Rule
- Proposed Technical Amendments to Advisers Act Rules
- New Risks and Opportunities
- Effect on Umbrella Registration
- Effect on Separately Managed Accounts
- Regulatory Guidance
- Best Practices
Sadis & Goldberg LLP
- On May 20, 2015, SEC issued a release proposing amendments to Form ADV and to certain rules under the Investment Advisers Act of 1940.
- The proposed amendments are relevant to all investment advisers, including investment advisors to hedge funds and private equity funds and those not currently managing private funds.
- The proposal are intended to modernize and enhance the disclosures for the investment management industry and further the SEC’s use of technology in its efforts to monitor risks as the primary regulator of registered investment advisers and registered investment companies.
- The proposals, with respect to investment advisers, to amend Form ADV to:
- Require investment advisers to provide information related to their separately managed accounts (“SMA”);
- Enable private fund investment advisers to file and “umbrella registration” for separate investment advisers that operate as a single investment advisory business; and
- Make certain clarifying, technical and other amendments.
- The proposal also seeks to amend Rule 204-2 under the Advisers Act, the books and records rule, and to make various technical and clarifying amendments to other rules under the Advisers Act.
Richards Kibbe & Orbe LLP
- The proposed disclosures with respect to separately managed accounts raise significant concerns over the confidentiality of client and proprietary firm information.
- While formalizing umbrella registration is universally welcome, there are a couple of key issues that have been raised with respect to the specifics of the proposal, in particular with respect to the exclusion of:
- Exempt reporting advisers
- Non-US advisers
- Requiring disclosure of whether or not an adviser uses a third-party compliance consultant provides little useful information to the SEC and can raise negative inferences or be confusing to clients and investors, in particular because there are many different services provided by these firms, many ways to use them, and a wide range of quality of service.
- Technical corrections to Form ADV Part 1 are welcome. There are various ambiguities in Form ADV Part 1; the SEC has proposed to correct some of them and commenters have proposed additional corrections/clarifications:
- Identification of related SPEs as investment advisers vs. sponsors/general partners of pooled vehicles
- Clarification regarding whether relying advisers must be identified as related persons in Schedule D, Section 7
- Custody rule clarifications – whether adviser or a related person has custody
Who Should Attend:
- Banking & Finance Lawyers
- Insurance & Related Lawyers
- Corporate Lawyers
- Business Lawyers
- Securities Lawyers
- Investment Advisers
- Broker Dealers
- In-House Counsel
- Compliance Officers
Daniel G. Viola is the Head of the Regulatory and Compliance Group of Sadis & Goldberg LLP, a leading New York based law firm with a diverse practice, representing investment advisers, funds and broker-dealers. Mr. Viola structures and organizes broker-dealers, investment advisers, funds and regularly counsels investment professionals in connection with regulatory and corporate matters. Mr. Viola served as a Senior Compliance Examiner for the Northeast Regional Office of the SEC, where he worked from 1992 through 1996. During his tenure at the SEC, Mr. Viola worked on several compliance inspection projects and enforcement actions involving examinations of registered investment advisers, ensuring compliance with federal and state securities laws. Mr. Viola’s examination experience includes financial statement, performance advertising, and disclosure document reviews, as well as, analysis of investment adviser and hedge fund issues arising under ERISA and blue-sky laws. Mr. Viola is also an active speaker and author of articles regarding the asset management industry.
Daniel G. Viola is the Head of the Regulatory and Compliance Group of Sadis & Goldberg LLP, a leading New …
Kimberly M. Versace is Counsel at Richards Kibbe & Orbe LLP. Kimberly’s practice focuses on securities regulatory and compliance matters, with an emphasis on Investment Advisers Act compliance. She provides ongoing advice to hedge fund and private equity fund advisers and other financial institutions in connection with the development of comprehensive compliance programs to address regulatory obligations imposed by federal laws and regulations, and advises investment firms on compliance with disclosure requirements, insider trading rules, conflicts of interest and other legal and regulatory requirements.
Kimberly M. Versace is Counsel at Richards Kibbe & Orbe LLP. Kimberly’s practice focuses on securities regulatory and compliance matters, …
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About Sadis & Goldberg LLP
Sadis & Goldberg LLP is a leading New York based law firm focused on delivering sophisticated and creative legal solutions in a highly professional manner. The Firm is internationally recognized for its financial services practice that consists of representing several hundred investment advisers and related investment entities (including hedge funds, private equity funds and venture capital funds). Similarly, the Firm provides regulatory and compliance advice and representation in connection with SEC enforcement proceedings. Notwithstanding the emphasis on the financial services industry, the Firm also provides a full range of tax, litigation, real estate, intellectual property and corporate services to its clients.
About Richards Kibbe & Orbe LLP
Richards Kibbe & Orbe LLP is an elite boutique law firm focused on the financial sector. For more than 25 years, RK&O has represented financial firms in transactions, compliance and litigation, and has consistently been at the forefront of emerging legal issues and investment activities. The sophistication and intensity that have made RK&O a leader in complex financial transactions and compliance issues have also driven its success in representing institutional clients, funds and individuals confronting government investigations, securities law violations and complex business disputes.
RK&O conducts a highly collaborative practice through approximately 65 lawyers based in New York, Washington, D.C. and London. With a long track record of achieving positive outcomes for clients, RK&O attorneys are recognized as being among the most qualified legal practitioners in the financial services sector, both in the U.S. and around the globe.