The US Securities and Exchange Commission (SEC) proposed on July 26, 2023, new rules designed to address conflicts of interest from the use of investment advisers under the Investment Advisers Act of 1940. These proposed rules aim to enhance investor protection and ensure transparency in the investment advisory industry.
In a Legal Alert issued before the SEC open meeting, we posed five questions that our Investment Services team would be looking out for as these new rules are considered. These questions revolve around the potential impact on advisory practices, disclosure requirements, and the overall effectiveness of the proposed rules in addressing conflicts of interest.
Washington D.C.--(Newsfile Corp. - August 1, 2023) - The Securities and Exchange Commission today charged Samuel Masucci and entities he controlled for engaging in fraudulent practices under the Investment Advisers Act of 1940. This enforcement action highlights the SEC's commitment to cracking down on violations of the Act and protecting investors from deceptive practices.
On June 8, 2023, the Securities and Exchange Commission's Division of Examinations released a risk alert outlining the SEC's broadened focus on conflicts of interest in the investment advisory industry. The alert highlights specific areas of concern, such as undisclosed compensation arrangements and inadequate disclosure of potential conflicts, and provides guidance on how investment advisers can comply with their fiduciary duty to clients.
Hearing Entitled: Reforming the Proxy Process to Safeguard Investor Interests Thursday, July 13, 2023, 10:00 AM in 2128 RHOB Subcommittee on Capital Markets. This hearing aimed to discuss potential reforms to the proxy process to protect the interests of investors. The Investment Advisers Act of 1940 was a key topic of discussion, as it governs the activities of investment advisers and their fiduciary duty to clients.
On July 26, the SEC issued proposed rules under the Securities Exchange Act of 1924 and the Investment Advisers Act of 1940 to address conflicts of interest in the investment advisory industry. These rules aim to promote fair competition, ensure transparency, and protect investors from potential harm caused by conflicts of interest.
Time to Read: 30 minutes. Practices: Asset Management, Investment Management. The following summarizes recent developments related to the Investment Advisers Act of 1940. This comprehensive overview provides insights into the proposed rules, risk alerts, and enforcement actions surrounding conflicts of interest in the investment advisory industry.
In its recent Request for Comment on Certain Information Providers Acting as Investment Advisers (the Request for Comment), the SEC sought public input on the regulatory framework for information providers who may inadvertently become subject to the Investment Advisers Act of 1940. This request aims to gather industry perspectives on potential amendments to the Act to accommodate evolving business models.
The U.S. Securities and Exchange Commission adopted new rules meant to reduce risk in clearance and settlement for most broker-dealer transactions. These rules, under the Investment Advisers Act of 1940, aim to strengthen the safety and resilience of the financial system by enhancing operational standards and risk management practices for broker-dealers.
Overall, the SEC's proposed rules and actions under the Investment Advisers Act of 1940 demonstrate a commitment to protecting investors and promoting fair practices in the investment advisory industry. By addressing conflicts of interest and enhancing transparency, these measures aim to ensure that investors are well-informed and receive unbiased advice from their investment advisers.
