I wrote about what to expect and how to prepare for an SEC exam two years ago, but the recently-released SEC Exam Handbook is a primary source that succinctly summarizes the current exam roadmap. What follows are a few interesting tidbits that I didn’t highlight in my prior article. 🔖 […]
Welcome to the July 17, 2026 edition of On The Docket, which includes the following content: 🌐 All past On The Docket editions (as well as other article, video, and podcast content) are available by visiting the On The Docket page of the Beach Street Legal website. 📥 If this […]
Welcome to the February 12, 2026 edition of On The Docket, which includes the following content: 🌐 All past On The Docket editions (as well as other article, video, and podcast content) are available by visiting the On The Docket page of the Beach Street Legal website. 📥 If this […]
Welcome to the December 19, 2025 edition of On The Docket, which includes the following content: 🌐 All past On The Docket editions (as well as other article, video, and podcast content) are available by visiting the On The Docket page of the Beach Street Legal website. 📥 If this […]
It seemed apropos to begin writing an article about artificial intelligence tools by prompting said artificial intelligence tools to write this entire article on my behalf. With Google Gemini, ChatGPT, Perplexity, Claude, and Grok all open in my web browser, I copied what I thought was a rather eloquent prompt […]
Welcome to the November 14, 2025 edition of On The Docket, which includes the following content: 🌐 All past On The Docket editions (as well as other article, video, and podcast content) are available by visiting the On The Docket page of the Beach Street Legal website. 📥 If this […]
Welcome to the September 15, 2025 edition of On The Docket, which includes the following content: 🌐 All past On The Docket editions (as well as other article, video, and podcast content) are available by visiting the On The Docket page of the Beach Street Legal website. 📥 If this […]
Welcome to the Aug 6, 2025 edition of On The Docket, which includes the following content: 🌐 All past On The Docket editions (as well as other article, video, and podcast content) are available by visiting the On The Docket page of the Beach Street Legal website. 📥 If this […]
Welcome to the June 23, 2025 edition of On The Docket, which includes the following content: 🌐 All past On The Docket editions (as well as other article, video, and podcast content) are available by visiting the On The Docket page of the Beach Street Legal website. 📥 If this […]
Welcome to the May 2, 2025 edition of On The Docket, which includes the following content: 🌐 All past On The Docket editions (as well as other article, video, and podcast content) are available by visiting the On The Docket page of the Beach Street Legal website. 📥 If this […]
Welcome to the March 12, 2025 edition of On The Docket, which includes the following content: 🌐 All past On The Docket editions (as well as other article, video, and podcast content) are available by visiting the On The Docket page of the Beach Street Legal website. 📥 If this […]
Welcome to the January 23, 2025 edition of On The Docket, which includes the following content: 🌐 All past On The Docket editions (as well as other article, video, and podcast content) are available by visiting the On The Docket page of the Beach Street Legal website. 📥 If this […]
The short version Reporting companies are not required to file beneficial ownership information (“BOI”) with FinCEN during the pendency of ongoing litigation in federal court. The long version Time will tell whether the BOI filing obligation will resurface down the line after working its way through the courts, but for now the ‘on again, […]
Welcome to the December 12, 2024 edition of On The Docket, which includes the following content: 🌐 All past On The Docket editions (as well as other article, video, and podcast content) are available by visiting the On The Docket page of the Beach Street Legal website. 📥 If this […]
A U.S. District Court for the Eastern District of Texas has issued a preliminary injunction that prevents the Financial Crimes Enforcement Network (“FinCEN”) from enforcing its Beneficial Ownership Information (“BOI”) reporting requirements. For reporting companies in existence before January 1, 2024, a BOI report filing would have been due by January […]
An investment adviser is a fiduciary. As a fiduciary, an investment adviser owes a duty of care and loyalty to its clients. The duty of care obligates an investment adviser to seek best execution of client securities transactions. Easy, right? If only. Neither the Investment Advisers Act of 1940 nor any of the […]
As you may be aware, certain states have adopted an annual Investment Adviser Representative (“IAR”) Continuing Education (“CE”) requirement. The states that have adopted an IAR CE requirement can be reviewed here, but have also been copied below for ease of reference. Such IAR CE requirements apply equally to both […]
Welcome to the September 6, 2024 edition of On The Docket, which includes the following content: 🌐 All past On The Docket editions (as well as other article, video, and podcast content) are available by visiting the On The Docket page of the Beach Street Legal website. 📥 If this […]
In academia, the specific content of an upcoming exam is kept under lock and key by the proctoring teacher until it is presented to students on the day of the exam. Students are expected to have studied the subject matter and class material with such thoroughness that – without knowing […]
Welcome to the May 10, 2024 edition of On The Docket, which includes the following content: 🌐 All past On The Docket editions (as well as other article, video, and podcast content) are available by visiting the On The Docket page of the Beach Street Legal website. 📥 If this […]
When the SEC first laid the path for registration as an “Internet investment adviser” in late 2002, the business model of rendering investment advice exclusively through an interactive website was still very much in its infancy. Wealthfront and Betterment, 2 of the earliest robo-advisers on the scene, didn’t register with […]
Welcome to the March 1, 2024 edition of On The Docket, which includes the following content: 🌐 All past On The Docket editions (as well as other article, video, and podcast content) are available by visiting the On The Docket page of the Beach Street Legal website. 📥 If this […]
Welcome to the fifth edition of On The Docket. This edition is dedicated to just a single topic: the Beneficial Ownership Information Reporting Rule. What follows is a very brief overview of the Beneficial Ownership Information Reporting Rule and its specific applicability to registered investment advisers, along with hyperlinks to […]
Welcome to the fourth edition of On The Docket, which is the recently-ascribed name to the Beach Street Legal blog. This edition includes the following content: 🌐 All past On The Docket editions (as well as other article, video, and podcast content) are available by visiting the On The Docket […]
When the SEC or its staff publishes anything related to rules, regulations, or interpretations, one of the most common prefatory pontifications is that the application of such rules, regulations, or guidance “depends on the facts and circumstances.” Read: We’re not going to paint ourselves into a corner and give specifically […]
5 Important Legal/Compliance Steps Of Buying, Selling, And Merging A Financial Advisory Firm A private company and its founder(s) are almost certain to experience at least one of the following 3 occurrences over the course of the company’s lifecycle: From a purely economic perspective, the 3 nearly inevitable occurrences listed […]
It is well understood that investment advisers are fiduciaries that owe a duty of care and a duty of loyalty to their investor clients. What is less well understood is what this actually means to advisers from a practical implementation perspective. In other words, how exactly should an adviser conduct […]
Welcome to the third edition of On The Docket, which is the recently-ascribed name to the Beach Street Legal blog. This edition includes the following content: 🌐 All past On The Docket editions (as well as other article, video, and podcast content) are available by visiting the On The Docket […]
2004 was a monumental year in the world of investment adviser compliance. It was the year that – for the first time – investment advisers registered with the SEC were required to 1) adopt and implement written compliance policies and procedures, 2) review such policies and procedures annually, and 3) […]
Welcome to the second edition of On The Docket, which is the recently-ascribed name to the Beach Street Legal blog. This edition is again longer than anticipated, but the SEC has been keeping the industry busy with new rule proposals and adoptions in recent weeks as you’ll see below. 🌐 […]
Welcome to the first edition of On The Docket, which is the recently-ascribed name to the Beach Street Legal blog. This inaugural edition is a lot longer than it will typically be in the future, as there was a fair amount of backlogged content and information that has accrued over […]
All investment advisers are fiduciaries that owe a duty of care and loyalty to their clients. In an ideal world, that would be the end of the story and the need for investment advisers to maintain a prescriptive code of ethics would be unnecessary. Unfortunately, the early 2000s were plagued […]
If the Form ADV is the most important regulatory filing for a registered investment adviser firm, the Form U4, also known as the Uniform Application for Securities Industry Registration or Transfer, is the most important regulatory filing for its individual investment adviser representatives. Form U4 is a unified form filed electronically through the FINRA […]
A dead Greek guy named Heraclitus is most often attributed as the source of the following platitude: “the only constant in life is change.” Though he predated the state/Federal divide of investment adviser regulation by about 2,500 years, his observation is apropos to advisers that are on the bubble of […]
Form ADV is perhaps the most important document a registered investment adviser will prepare in the entirety of its life cycle – at least from a regulatory perspective. This is not only because it is filed with the SEC and/or state securities regulatory authorities, but also because it is publicly available and […]
November 4, 2022, marked the mandatory compliance deadline with respect to the SEC’s overhauled Marketing Rule. It also marked the day that the SEC’s former Cash Solicitation Rule was put out to pasture after 43 years. It was a good run. The former Cash Solicitation Rule may be gone, but it is not […]
While the SEC’s recently overhauled Marketing Rule has received significant attention primarily for its newfound permissibility with respect to investment adviser testimonials and endorsements, there’s another equally significant component of the Marketing Rule worth discussing: performance advertising. This component of the Marketing Rule synthesizes myriad SEC no-action letters and guidance over the past several […]
Part 1: When, Why, & How to Register or Notice File In the United States, the regulation of investment advisers is intentionally divided between both Federal and state governments. This duality continues the through-line of Federalism borne out of the Constitution, but creates potentially very different experiences for advisers registered […]
Part 1: Statutory Requirements As unbelievable as it may be, the Investment Advisers Act of 1940 and the rules thereunder don’t require client advisory agreements to be in writing. Seriously. Technically speaking, an oral understanding that is never memorialized to a written instrument may be deemed a valid means by which a […]
Pursuant to the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), those that provide fiduciary investment advice to plan sponsors, plan participants, and IRA owners may not receive payments creating conflicts of interest unless they comply with protective conditions in a “prohibited transaction exemption” (or “PTE”). What constitutes […]
There have been a few interesting regulatory developments from our friends at the SEC recently, and we thought it best to summarize the more notable of such developments below: “Hedge Clauses” in Advisory Agreements A “hedge clause” is a contractual provision that purports to limit one party’s potential liability to […]
With any luck (and lots of hard work), the founder of a financial advisory firm will inevitably be confronted with the following realization: I need to hire someone. As a firm grows and matures, and the founder spends comparatively more and more high-value time actually rendering advice and managing client […]
Author’s Note: The SEC’s Final Rule (86 FR 13024) was published in the Federal Register on March 5th, 2021. The effective date for the rule will be May 4. RIAs have 18 months to become compliant with the new rule, with a firm compliance deadline of Nov. 4, 2022. In the automotive […]
July 10, 2020 Author’s Note: Two days after this article was published, the SEC proposed to update Form 13F and – most significantly – increase the reporting threshold from $100 million to $3.5 billion. As much as I would like to take credit for the SEC’s swift reaction to my […]
The integration of college funding services into an adviser’s practice is an excellent way to add another dimension to the comprehensive financial planning process. Given the significant financial impact that college funding decisions alone can have on a family’s overall financial plan, such integration can also have the added benefit […]
The rules governing investment advisers’ ability to pay for client referrals may be deceptively complicated, but at least such rules exist in the first place. When the SEC first proposed to regulate paid solicitors in Advisers Act Release No. 615 in 1978, it sought public comment on the advisability of […]
An investment adviser’s fiduciary duty to seek best execution of its clients’ securities transactions has recently stepped back into the spotlight. In July, the SEC issued a Risk Alert entitled “Compliance Issues Related to Best Execution by Investment Advisers,” and in April it released its much-anticipated proposed interpretive guidance regarding […]
Advisor. Broker. Wealth Manager. Financial Advisor. Investment Advisor. Financial Consultant. Financial Planner. Savings Coach. Budget Doctor. Wealth Architect. Money Ninja. Cash Llama. The regulatory approach to financial professional titles to-date has pretty much been “Pick one and have at it.” Hyperbole aside, I’m far from the first person to observe […]
A few months ago, I wrote an article about the regulatory considerations that an RIA should keep in mind when hiring a new individual advisor into its business. Because that article was specific to new investment adviser representatives (“IARs”), it focused on disclosure, licensing, registration, documentation and insurance matters. But […]
The SEC’s custody rule has proved to be a real pain in the ass. But then again, so too did Bernie Madoff (and that is perhaps the most generous of monikers). Lest we forget, the SEC’s laser focus on the custody rule as we know it today is borne in […]
If you own an investment advisory business, growth is a good problem to have. It can become such a big problem, however, that you may consider hiring another you… another financial advisor to help serve your existing clients and prospect for new ones. There are many legal and compliance considerations […]
“Supervision” is one of those compliance buzzwords that gets tossed around without much explanation, like its meaning is taken for granted and assumed to be obvious. I submit to you that it is not, especially when it comes to demonstrating that adequate supervision of a person, process, product, or policy […]
A little less than a year ago, I wrote an article about alternatives to mandatory arbitration for resolving disputes between advisors and their clients (see, Beyond Mandatory Arb: 4 Options for Advisor-Client Dispute Resolution). Consider this article the prequel. Indeed, there is an even more attractive means to resolve a […]
There’s a State Farm commercial currently on TV that depicts Green Bay Packers quarterback Aaron Rodgers attempting to kill a fly in his house using a golf club. He swings wildly at the fly, loses his grip on the club, and sends it crashing through his bay window and into […]
In some form or another, nearly every registered investment adviser will at some point be involved in a merger, acquisition, sale, or restructuring. Whether it’s a simple equity ownership stake by a new financier, the addition of a new partner, a union of two practices, the death of a major […]
Federalism can be a real pain in the neck sometimes. While the duality of both state and federal government has endured and served our country well, it has made investment adviser registration at the state level a mix of hard-to-find statutes, non-intuitive exceptions and revenue grabs. The most notable of […]
Last month I penned an article that described how the SEC expects advisors to calculate their Regulatory Assets Under Management (“RAUM”) with respect to investment management and financial planning clients. Only securities portfolios for which the advisor provides “continuous and regular supervisory or management services” count toward RAUM, but advisors […]
As the financial services industry continues to evolve, so, too, does the distinction between “investment management” and “financial planning” as discreet but complementary services that a registered investment adviser can provide to clients. I’d read two of Michael Kitces’ recent posts for a more fulsome discussion of an “investment-centric” versus […]
It’s been said that the eyes are the window to a person’s soul, but I’d argue that a person’s internet browsing history is also pretty telling. It can reveal a lot, and in my case it revealed that I am a complete and incorrigible fanboy of the laws, rules and […]
The principle of attorney-client confidentiality is sacrosanct. In California, for example, an attorney may only reveal a client’s confidential information to the extent the attorney “reasonably believes the disclosure is necessary to prevent a criminal act that the [attorney] reasonably believes is likely to result in death or substantial bodily […]
On the heels of the Financial Industry Regulatory Authority issuing a Report on Digital Investment Advice last month, on April 7 the Securities and Exchange Commission approved a FINRA rule amendment that requires registration of persons that are “primarily responsible for the design, development or significant modification of algorithmic trading […]
This year will go down in history as the year of the great fiduciary wars: advisors v. brokers, DOL v. SEC, Senator Elizabeth Warren v. the entire financial services industry…the list could go on. Tensions have flared and much ink has been shed. When the dust and rhetoric settles, the […]
Mandatory pre-dispute arbitration clauses in advisory contracts are all the rage… and I mean that both literally and figuratively. It has become both a popular dispute resolution mechanism between advisors and their clients, and at the same time has enraged critics the likes of which include a cadre of House […]
If you’re reading this article, my working assumption is that at some point in your life you’ve been employed by somebody other than yourself. Odds are you’re working for somebody else at this very moment, perhaps even plotting the day you jump ship and join a competitor or set out […]
A limited liability company is as easy to set up as it is to screw up. Though it is justifiably advisors’ favored business structure due to its simplicity, flexibility and liability protections, there are still a select few “corporate formalities” that should be observed. The primary such formality is what’s […]
I can’t guarantee much from my personal crystal ball, but looking across the regulatory horizon into 2016 there is one undeniable certainty: Securities attorneys will be just fine. The sheer volume of complicated rulemaking that is pouring out of Washington bodes well for billable hours but not for bottom lines. […]
October 26th marked the final day of briefing before the SEC in what could be a very precedential case for investments advisors, compliance officers and the independent compliance consulting community. In the Matter of The Robare Group, Ltd. began its life in September 2014 as an order instituting administrative and cease-and-desist […]
This past week the SEC announced a $40 million enforcement action against investment advisor First Eagle Investment Management and its affiliated broker-dealer FEF Distributers for what it touted as the first to arise from its “distribution-in-guise” initiative. Advisors to funds have been anxiously awaiting some sort of guidance since the […]
Investment advisory contracts (and most contracts, in general) are typically long, laborious and full of legalese. Paid-by-the-word attorneys have to pay for their silk ties somehow, right? If drafted properly, however, such contracts can also be immensely helpful in clarifying roles and responsibilities between the advisor and the client, and […]
After Henry Hill took his first pinch in Goodfellas, Jimmy Conway praised young Henry in the courtroom for learning and personifying the Mafia code: “Never rat on your friends and always keep your mouth shut.” While certainly one of the great bro-quotes in movie history, I don’t think I’m venturing […]
As of the writing of this article, 74 of the 129 SEC press releases year-to-date announce enforcement actions, settlements and other financial professional misdeeds. Mind you, these are not press releases of the Division of Enforcement within the SEC, but the SEC as a whole. The other 55 generally speak […]
Advisor continuity and succession planning has been written about and talked about ad nauseam, but I would say justifiably so. It is a critical industry-wide issue that warrants industry-wide action. Yet each and every advisor’s individual situation is unique and requires individualized attention to the nitty-gritty details. One such detail […]
A recent string of SEC enforcement actions should prompt advisors to carefully review their Form ADV for one potentially dangerous word: “may.” It likely appears many times throughout various sections, and in most instances is likely perfectly appropriate. Where it isn’t appropriate, the SEC has made clear, is when it […]
The SEC has had a healthy obsession with conflicts of interest as of late, and this week’s Guidance Update from the Division of Investment Management is no exception. The update, entitled “Acceptance of Gifts or Entertainment by Fund Advisory Personnel – Section 17(e)(1) of the Investment Company Act,” may at […]
Let me get one thing straight right out of the gate: technology is not a compliance panacea. It may afford incredible efficiencies and in certain applications be substantially more accurate and reliable than us mortal humans, but it is not a set-it-and-forget-it prophylactic to all nefarious intentions. After all, technology […]
Due diligence in the advisory world is like an onion: the more layers you peel back, the more it’s likely to stink. The goal, however, is to expose the stink and cook through it to satisfy both regulatory expectations and fiduciary obligations. But enough with bizarre food analogies… Much like […]
This is the time of year when I tend to throw things at my television, yell at my car radio and redirect most of the mail I receive directly to the trash (sorry – the recycling bin for you greenies). The reason is simple: it’s election season, and the amount […]
It’s important to get one thing out of the way right off the bat: technically there is no requirement imposed upon investment advisors to maintain an anti-money laundering program pursuant to the Bank Secrecy Act of 1970, the Money Laundering Control Act of 1986 or the USA PATRIOT Act, as […]
Congratulations! You’ve contracted with a vendor to capture and archive all emails sent to and from employees within your advisory firm. Emails are set to be stored for not less than five years pursuant to the SEC’s recordkeeping requirements and are ready to be turned over when requested during an […]
The rulemaking phraseology of the SEC can be, at times, somewhat antiquated when it comes to the brave new world of the Internet and technology. To this day, there are references in the Advisers Act and the rules thereunder to, for example, “chat rooms,” “bulletin boards,” and “microfiche.” At the […]
If an advisor is able to withstand narcoleptic impulses when reviewing its investment advisory contract, I suggest taking a moment to focus on the section that addresses the advisor’s limitations of liability. In regulatory-speak, this clause of the contract is known as a “hedge clause,” and is typically found near […]
The purchase, sale or merger of an advisory practice involves a whirlwind of tightly-coordinated efforts by a myriad of different parties. In the shuffle of negotiating the deal terms, settling on a valuation methodology, coordinating with custodians and integrating technological systems, when does the client get a say, if any? […]
By this point, all advisors with a Dec. 31 fiscal year-end should have filed their annual updating amendment to Forms ADV Part 1 and 2 with the Securities and Exchange Commission through the Investment Adviser Registration Depository. If any material changes occurred since the last annual updating amendment, advisors should […]
The notion of “regulatory hot topics” has become somewhat of a misnomer given the “broken-windows” approach of today’s SEC [see footnote below]. To say that some regulatory topics are “hot” naturally implies that some regulatory topics are…not hot. I don’t think I’m too far afield to suggest that SEC Chair […]
Client referrals are arguably the lifeblood of the financial services industry, and understandably so. They are perhaps the greatest compliment a financial professional can receive, and it sure beats a random LinkedIn endorsement from that guy you had a fleeting interaction with at a conference five years ago. Some financial […]
The last time I used a microfilm reader was in the dusty depths of my college library, reviewing newspaper clippings from the 1960s for some God-forsaken reason. The windowless bunker looked and smelled as if it had been vacuum-sealed since the very period in history I was researching. Fast forward […]
Conflicts of interest are inherent and at times inescapable in the financial services industry. The entire brokerage and commission-based industry was arguably built on one: a broker getting paid per transaction to sell certain products to clients (i.e., the broker is arguably incentivized to trade an account and recommend securities […]
Although the SEC may have hemorrhaged senior staff this year, its rules and regulations remain in full force and effect. For RIAs, this means that the end of the year should be a time to prepare for and tackle the annual regulatory requirements imposed upon them. In the first part of our […]
Malls are starting to be overrun with holiday shoppers, temperatures are dropping and congressional members will soon take a recess from fulfilling their civic duty of wearing power suits and hemorrhaging taxpayer dollars. Ah yes, all the signs of a coming winter are upon us. Although the SEC may have […]
On November 17, 2009, an act of God occurred: eight federal agencies agreed on something. That something was a set of four model privacy notice forms that could be delivered to consumers (including investment advisory clients) to satisfy the information disclosure requirements of the Gramm-Leach-Bliley Act (GLB). Said another way, use of […]
One of the tenets of Modern Portfolio Theory is that risk and return are related; that is, a higher degree of risk in a client’s investment portfolio is expected to generate a higher return. Conversely, less risk is expected to generate a lower return. More risk in a compliance program, […]
Not all registered investment advisers are afforded a Manhattan zip code, enough vice presidents to annex France, or a travel budget the size of our national debt. Quite to the contrary, it’s more the norm for the smaller RIA to have a Des Moines area code, a combined CEO/CFO/CCO/Office Manager […]
On February 21, 1878, the first telephone book was issued in New Haven, Connecticut. On the same date in 1925, the New Yorker published its first issue. And on the same date in 2013, the SEC published its examination priorities for the year.1 Some have called it the literary trifecta […]
When it comes to custody, most registered investment advisers avoid it like you avoid the obnoxious coworker at the company party. Both require careful maneuvering to evade, are easy to confront if you’re not paying attention, and can be extremely challenging to understand when engaged. Suffice it to say, accidental […]
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