Author Archives: AdviserCounsel

Its official. The Marketing Rule was published in the Federal Register this morning on March 5, 2021. This means that the rule will become effective on May 4, 2021. The new rule contemplates an eighteen-month transition period between the effective date of the rule and the compliance date. This means your firm should be preparedContinue reading “Marketing Rule to Officially Become Effective on May 4, 2021”

 On December 22, 2020, the U.S. Securities and Exchange Commission adopted amendments to Rule 206(4)-1 under the Investment Advisers Act of 1940 relating to advertisements. Among other things, these amendments, when effective, will permit testimonials. The rules are currently under review by the Biden Administration and won’t become effective until 60 days after they are publishedContinue reading “Will Investment Advisers Registered with the States Be Able to Use Testimonials?”

There has been a lot of debate this year about the fairness of advisory fees. Who am I kidding? This is a debate that has been going on for years now. In this post, I address what the law says about advisory fees (but not performance-based fees). In my next post I plan to shareContinue reading “Advisory Fees – What Does the Law Say?”

I recently assisted a client with a response to a data breach incident. This isn’t an uncommon occurrence. Our law firm is notified almost weekly of a data breach incident involving one of our investment adviser clients. Most commonly, an unauthorized person gains access to an employee’s email and the inbox contains non-public information. TheContinue reading “Federal Data Breach Law is Long Overdue”

Acting Chair Allison Herren Lee and Commissioners Peirce, Roisman, and Crenshaw recently released a statement on the recent market volatility. Their statement highlighted the Commission’s essential mission to “protect investors; maintain fair, orderly, and efficient markets; and facilitate capital formation.” Recent events serve as a reminder that these functions are interconnected and there are veryContinue reading “The Interconnectedness of Markets and Reserving Judgment in Light of Recent Trading Events”

In late 2020, MicroStrategy, led by CEO Michael Saylor, purchased $650 million worth of Bitcoin as a reserve asset. Morgan Stanley and its subsidiaries and affiliates also purchased a considerable part of MicroStrategy. In early 2021, the value of Bitcoin crossed $30,000. Then $40,000. Institutional investors started flocking to the asset. Even an old stodgyContinue reading “Managing Cryptocurency and Digital Assets in Separate Accounts. Comply With The Custody Rule!”

The new marketing rule provides an opportunity for investment advisers to compliantly test out new marketing methods. This post will provide a running list of pointers that I think investment advisers and investment professionals may find helpful or interesting. All of these practice pointers assume the rule is effective. None of these pointers should beContinue reading “A Running List of Practical Pointers Under the New Marketing Rule”

On December 22, 2020, the U.S. Securities and Exchange Commission adopted amendments to the rules under the Investment Advisers Act of 1940 relating to advertisements. A copy of the adopting release is available here. When news first broke, I provided my initial thoughts via Twitter (which I have included below), but the purpose of thisContinue reading “SEC Amends Advertising and Solicitation Rules”

Who should be worried? What should we be doing? What went wrong? Should we care? The U.S. Securities and Exchange Commission (“SEC”) settled an enforcement matter with Voya Financial Advisors, Inc. on December 21, 2020. This is yet another case that does a disservice for the investment advisory legal and compliance industry by providing unclearContinue reading “VOYA Financial Advisors Enforcement Action”

The Department of Labor announced its long-awaited final class exemption from certain prohibited transaction under the Employee Retirement Income Security Act of 1974, asamended (the Act). Putting aside whether the Biden administration will freeze and repeal this exemption, this post is designed to address the differences between the proposal and the final exemption. The finalContinue reading “Department of Labor’s Final Fiduciary Rule Exemption – What’s Different Between the Proposal and the Final Exemption?”