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Division of Investment Management:
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If you want to register as an investment adviser with the SEC, check the information under "How To Register." |
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If you want information on investment advisers, check "Adviser Info on IAPD." |
The Commission has approved a two-year waiver of initial set-up and annual IARD filing fees for investment advisers registered with the Commission or applying for registration with the Commission. (Commission Order) SEC-registered investment advisers will not have to pay the fee associated with their annual amendments filed from November 1, 2006 through October 31, 2008. For the same period, investment advisers filing with the Commission for initial registration on the IARD will not have to pay the initial set-up fee.
Applications for SEC registration on Form ADV filed on or after November 19, 2008 will not be declared effective before January 2, 2009 absent filer requests to the contrary. Filers can request that approval not be deferred either on Schedule D of Form ADV (in the Miscellaneous section), or by calling the SEC IARD Filing Status phone number (202-551-7250). The Commission will, however, act on all registration applications within 45 days of filing as required by section 203(c)(2) of the Advisers Act.
The staff is deferring the effective date of initial registration applications filed late in the year in order to alleviate a filing burden that could affect new applicants with a fiscal year ending December 31. Each adviser, once its SEC registration is effective, must file an annual updating amendment within 90 days after the close of its fiscal year. Therefore, if a new applicant for SEC registration with a December 31 fiscal year end filed its initial Form ADV in late November 2008 and the SEC declared its registration effective during the month of December 2008, the new registrant's first annual updating amendment would be due by March 31, 2009, only a few months after the initial filing. The result of deferring the effective date means that an adviser with a December 31 fiscal year end, applying for initial SEC registration late in the year, will file its first annual updating amendment no later than March 31, 2010.
On August 21, 2006, NASD, now FINRA, operator of the IARD system, implemented Release 8.1. The following information explains certain changes to IARD that may impact the process of making filings as an investment adviser with the SEC on the IARD system:
Your email address is listed in IARD. Please confirm your email address by visiting: https://www.webiard.com/xxxxx(You cannot use the URL in the example to confirm your Email address. You can only confirm your Email address by using the URL in a Verification Email you receive from the IARD system.)
<firmemailaddress><authenticationkey><firmcrdnumber>.
After successfully logging into IARD with the aforementioned URL, your email address will be confirmed.
You may obtain more complete information about Release 8.1 at www.finra.org.
In December 2004, the Commission adopted a new rule that required advisers to certain hedge funds (called "private funds" in the rule) to register with the Commission. In the rulemaking, the Commission also amended Item 7.B. and Section 7.B. of Schedule D of Part 1A of Form ADV (the "Form ADV Amendments"). On June 23, 2006, the United States Court of Appeals for the District of Columbia Circuit vacated the rulemaking, including the Form ADV Amendments. However, it will take some time to reprogram the IARD to reflect this reversal; until the reprogramming can be done, Form ADV will continue to display the amendments that the Court vacated (most of which involved references to the new term "private fund").
We are providing guidance to investment advisers on responding to Item 7.B. and Section 7.B. of Schedule D of Part 1A until the IARD revisions can be made. All advisers may follow this guidance, but it is not required and no adviser is foreclosed from responding to Form ADV as it appears. If you are already registered, you may, but are not required to, amend your Form ADV to reflect this guidance. Even if you are filing an other-than-annual amendment to your Form ADV for some other reason, you are not required to amend your responses to Item 7.B. and Section 7.B. of Schedule D because of this guidance (under General Instruction 4, you are required to update Item 7 (and, accordingly, Section 7.B. of Schedule D) only in conjunction with annual updating amendments). If you are a new registrant or if you are submitting new information in response to Item 7.B. or Section 7.B. of Schedule D, you may complete the questions as they appear or follow this guidance.
You may answer the question as though it reads: "Are you or any related person a general partner in an investment-related limited partnership or manager of an investment-related limited liability company?" Therefore, if you answered "Yes" to Item 7.B solely because of the reference to other private funds, you may change your answer to "No." Please note that if you change your answer to "No," you must delete all funds you listed on Section 7.B. of your Schedule D, or your filing will fail a completeness check on the IARD system. If you would still answer "Yes" even without the reference to private funds, you cannot change your answer to Item 7.B. to "No."
You may read this sentence as though it says: "If "yes," for each limited partnership or limited liability company, complete Section 7.B. of Schedule D." If you are relying on this guidance to delete private funds from Section 7.B. of your Schedule D, make sure that the private fund is not a limited partnership or limited liability company that you would have to list on Schedule D even if the sentence appeared this way.
You may read the sentence as though it says: "You must complete a separate Schedule D Page 4 for each limited partnership in which you or a related person is a general partner and each limited liability company for which you or a related person is a manager." If you are relying on this guidance to delete private funds from Section 7.B. of Schedule D, make sure that the private fund is not a limited partnership or limited liability company that you would have to list even if the question appeared this way.
On April 10, 2006, NASD, now FINRA, operator of the IARD system, implemented Release 8.0 of the IARD. The following information explains certain changes in IARD that may impact work processes for making filings as an investment adviser with the SEC on the IARD system:
You may obtain more complete information about Release 8.0 at www.finra.org.
On October 31, 2005, the IARD system was enhanced to add an email alert and reminder function. With this email function, each SEC-registered investment adviser will receive email reminders of certain filing deadlines as well as email notices of SEC regulatory and compliance information, if the adviser supplies the email address of its contact employee in its response to Part 1A, Item 1.J.
Not a "pfishing" scam: The email function sends each active SEC registrant a "Contact Email Verification" email at the contact employee's email address, asking the contact employee to authenticate the email address through the IARD website using an authentication key. Contact Email Verification notices requesting your contact employee to visit a web URL beginning with the prefix https://www.webiard.com/ are valid. If you have any questions or concerns about the authentication process, contact the FINRA Gateway Call Center at 240-386-4848.
Your firm cannot receive the benefit of email alerts and reminders unless you (i) supply an accurate email address in Item 1.J. and (ii) authenticate the email address through the Contact Email Verification notice sent to that address by the system. If your contact employee name or email address in Item 1.J is inaccurate in any way, you have a legal obligation to update that information promptly by amending your Form ADV on the IARD system (see General Instruction 4 to Form ADV). The system will automatically send a new Contact Email Verification email any time you amend your Form ADV to change your contact employee email address in Item 1.J.
The email system will notify your firm of:
The Commission has approved a one-year waiver of IARD filing fees for SEC-registered investment advisers. (Commission Order) SEC-registered investment advisers will not have to pay the fee associated with their annual amendments filed from November 1, 2005 through October 31, 2006. This fee is set at $100, $400, and $550 depending upon the adviser’s assets under management. The North American Securities Administrators Association (NASAA) also announced that the annual system renewal fee of $100 for each state-registered investment adviser and $45 for each investment adviser representative has been waived for the upcoming renewal cycle.
The Securities and Exchange Commission has established a website directory to help investors contact their investment advisers where normal operations have been disrupted. The directory provides alternate contact information for registered investment advisers in Mobile, Ala.; Covington, La.; Metairie, La.; New Orleans, La.; and Gulfport, Miss. The alternate contact information will include telephone numbers, alternate business addresses, and e-mail addresses as provided by the advisory firms on a voluntary basis.
The website directory can be found at the Commission’s Katrina Regulatory Relief and Assistance website, www.sec.gov/katrina.htm.
The Commission adopted a new rule 204A-1 requiring SEC-registered investment advisers to adopt and enforce codes of ethics that establish standards of conduct expected of supervised persons and reflect the adviser's fiduciary duties. A code of ethics must require supervised persons to comply with applicable federal securities laws, and certain supervised persons ("access persons") must report their personal securities holdings and transactions, including transactions in mutual funds advised by the adviser or an affiliate. Advisers must, on Schedule F of their Form ADV Part II, describe their code of ethics and state that they will provide a copy of the code to any client or prospective client on request. The compliance date for the new rule and rule amendments was originally set at January 7, 2005, but has been extended to February 1, 2005.
On December 14, 2004, the Commission's Pacific Regional Office sent a letter to SEC-registered advisers that were delinquent in filing their annual updating amendments since 2003. Delinquent filers have until February 11, 2005 to file the required annual updating amendments and avoid an enforcement proceeding based on the delinquency. Delinquent filers are reminded that there is a fee required with the filing of an annual updating amendment and they should ensure that adequate funds are in their IARD account before attempting to submit the delinquent filing(s).
Q. My firm has filed amendments to its Form ADV during the past two years; why did I receive a delinquency letter?
A: Check your filings. You may have submitted Other-Than-Annual amendments and failed to submit Annual Updating Amendments. You must file an Annual Updating Amendment each year within 90 days after your firm's fiscal year end. You must identify the filing as an Annual Updating Amendment, and the IARD system will also ask you to identify which fiscal year you are filing for.
Q: My firm has a December 31 fiscal year and we failed to file our Annual Updating Amendments due in March 2003 and March 2004. To correct our delinquency, are we required to file one Annual Updating Amendment to cover both our 2002 and 2003 fiscal years, or two Annual Updating Amendments?
A: You are required to file two Annual Updating Amendments, one for the fiscal year ended December 31, 2002, and one for the fiscal year ended December 31, 2003. The IARD system will ask you to identify which fiscal year the filing is for. The information in each filing should be correct as if you had made the filing when it was due. For example, if you had a reportable disciplinary event that occurred in October 1994, it must be reported in both your filings, even though 10 years have now passed since the date of the event.
Q: We recently filed an Other-Than-Annual amendment identifying a new officer of our firm or making other changes to the information on our Form ADV. When we make our delinquent filings listing the previous officer or old information, will that create any problem?
A: Yes, your delinquent filings will overwrite your current information as it appears on the IARD system. After you file your missing Annual Updating Amendments, you will need to file a further amendment to bring your composite information on the system current again.
Q: My firm will continue doing business as an investment adviser, but we need to "switch" to state registration and withdraw our SEC registration. Should we file a Form ADV-W now?
A: If your firm is not going out of business, and you are withdrawing your SEC registration because you are "switching" to state registration, you must make sure that there is no "gap" in your registration. Register with state authorities before your SEC registration is withdrawn. Remember that your Form ADV-W is effective upon receipt by the SEC.
Q: My firm's assets under management fell below $25 million and we did not file our Annual Updating Amendment because we were in the process of switching to state registration. Our state registration is still pending so we do not want to withdraw our SEC registration yet. What should we do?
A: That is not a reason to miss your Annual Updating Amendment. You should file the delinquent Annual Updating Amendment(s) and check box
A(12) on Item 2 to indicate that you are no longer eligible for SEC registration.
Q: I received the December 14, 2004 delinquency notification letter. Does this letter mean that I am the subject of a regulatory proceeding that must be disclosed in Item 11.G of my Form ADV?
A: No, the December 14 letter does not mean that you are the subject of a regulatory proceeding. The purpose of the letter was to notify you that you have not filed the required Annual Updating Amendments and provide you with an opportunity to avoid a regulatory proceeding by filing now.
Q: I still have questions. Whom should I contact?
A: If you have technical questions about how to file on IARD electronically or paying your filing fees, please contact the IARD help line at (240)386-4848 or e-mail webiard@finra.org.
If your question is about the fact that you have been listed as a delinquent filer, which Annual Updating Amendments you are missing, or the possible enforcement proceedings mentioned in the December 14, 2004 letter, please call (323) 965-4515 or e-mail DelinquentADV@sec.gov.
If your question is about what information to provide in response to an item in a Form ADV amendment or on a form ADV-W, please call the Office of Investment Adviser Regulation at (202) 551-6999 or e-mail IARDLIVE@sec.gov.
The Commission adopted amendments to the custody rule under the Investment Advisers Act of 1940. Amended rule 206(4)-2 requires advisers with custody to keep client assets with banks, broker-dealers or other qualified custodians. Advisers whose clients receive account statements directly from the qualified custodian are relieved from sending their own account statements and undergoing annual surprise examinations.
The Commission also amended two custody-related items in Form ADV. SEC-registered advisers that have custody only because they deduct fees directly from their advisory clients' accounts may answer "no" to Items 9A.(1) and 9A.(2) of Part 1A. For most advisers, this new instruction will not require a different response to Item 9 because they, in reliance on SEC staff no-action letters, have not previously treated their ability to deduct fees as giving them custody of client assets. SEC-registered advisers are also not required to provide a Schedule G balance sheet in response to Item 14 of Part II solely because they have custody (advisers must still provide a balance sheet if they require certain prepaid fees). Advisers may begin relying on the amendments on November 5, 2003, and advisers must be in compliance with the amendments by April 1, 2004.
On July 14, 2003, the Commission approved the adoption of certain technical revisions to Forms ADV, ADV-W and ADV-H and related rules under the Investment Advisers Act of 1940. These changes are designed to provide additional help to advisers when completing and filing their forms.
The Department of Treasury has proposed a new anti-money laundering rule under the USA Patriot Act of 2001 that will require those SEC registered investment advisers who manage client assets to establish anti-money laundering programs. Certain unregistered advisers also are covered by the proposed rule. The proposed rule would define these advisers as "financial institutions" under the Patriot Act's provisions. Advisers will be required to have 1) anti-money laundering internal policies, procedures, and controls; 2) a designated compliance officer; 3) an ongoing employee training program; and 4) an independent audit function to test the firm's programs. Public comments should be submitted to the Financial Crimes Enforcement Network, Department of the Treasury by late June, 2003.
The Commission adopted a new rule 206(4)-6 requiring SEC-registered investment advisers that exercise voting authority over client securities to adopt policies and procedures reasonably designed to ensure that the adviser votes proxies in the best interests of clients. These advisers are required to inform clients about their policies and procedures, give clients a copy upon request, and disclose to clients how they can obtain information from the adviser about proxy votes cast. Rule 204-2, the books and records rule, also was amended to require that these advisers maintain certain records of their proxy voting activities. Advisers must be in compliance with the new rule and amendments by August 6, 2003.
Since September 25, 2001, investors have had Internet access to information contained in Form ADV electronic filings made by investment advisers on www.adviserinfo.sec.gov. This new Investment Adviser Public Disclosure (IAPD) website was launched by the SEC and NASAA to provide clients and prospective clients of advisers with direct access to Form ADV filings made by the then approximately 7,800 SEC-registered advisers and 8,200 state-registered advisers who filed Form ADV through IARD. This electronic database will expand significantly because increasing numbers of state-registered advisers are switching to electronic filing each day.
All information filed by advisers on Form ADV is available on this new website except for social security numbers, certain home addresses, and contact employee information. The new website is available free of charge, 24 hours a day. In the future investors may be able to access information about "investment adviser representatives."
http://www.sec.gov/divisions/investment/iard.shtml
| Contact | Employment | Links | FOIA | Forms | Privacy | Modified: 08/20/2008 |
