Advisory Contracts

Qualified Client Threshold Adjusted

Its just a little adjustment - but a little may make the difference between being able to charge performance fees or not. The SEC on June 14 adjusted the dollar threshold used to exempt an adviser from the prohibition on charging performance fees.

Proposed Incentive-Based Compensation Rule: Advisers Should Pay Attention

The proposed rule issued May 6 by the SEC and five other federal agencies that would prohibit financial institutions from offering incentive-based compensation encouraging inappropriate risk taking should be viewed with concern by at least large investment advisers. While the rule would affect only advisers with more than $1 billion in assets, the way the SEC counts such advisers may mean that some firms that believe they are under the threshold may actually fall within it.

Assignment: Know the Requirements and Avoid the Pitfalls

Make sure your clients - and your firm - are protected when there is change in control of your firm that may result in an assignment.

Terminate that Advisory Contract the Right Way

Keep your clients interests first - even when terminating an advisory contract. That is, after all, your fiduciary duty. But contracts can be terminated in a way that helps your firm, as well.

Compensation Arrangements: A Little Bit of Disclosure Does Not Go a Long Way

Dont fall into the trap of thinking you can satisfy clients and the SEC by disclosing partial information about your firms compensatory arrangements. One adviser found this out the hard way when it settled a case for allegedly doing just that.

Advisory Contracts: Dont Cut Corners on the Approval Process

The advisory contract process for mutual funds is meant to be followed. Advisers and board members cannot ignore parts they dont like.

Misallocation of CEO Compensation Adds Penalty to Advisers Ledger

If the charges in an SEC settlement are to be believed, an adviser and its chief financial officer/chief compliance officer attempted to deceive the board of directors of a fund series by misallocating the adviser CEOs salary in an attempt to make profits look consistent. Now it is paying the costs of a settlement instead.

Advisory Agreement Case: SEC Files New Charges After $55M Court Win

Watch out for those old active advisory contracts. They can come back and bite you. The SEC on April 28 instituted administrative proceedings against adviser Charles Kokesh. The Commission action followed a March 30 final judgment by the U.S. District Court for the District of New Mexico, in which Kokesh was ordered to pay more than $55 million in disgorgement, interest and civil money penalties.

SEC Ongoing Insider Trading Case Snags a Hedge Fund Manager

A hedge fund manager is the latest to be charged by the SEC in the agencys ongoing prosecution of former executives and others involved in an alleged insider-trading scheme.

Verdict in $35 Million Theft Case Shows Importance of Advisory Agreements

A New Mexico jury on November 7 demonstrated the danger of straying from investment advisory agreements.

Audio Interviews

How to Read an SEC Enforcement Action

Stern Tannenbaum law firm partner Aegis Frumento on how to get the most from reading an SEC administrative order or court complaint.

Most Important Supreme Court Decisions for Advisers and Funds

Find out the high court decisions from recent years that are likely to affect how advisers and investment companies work from Debevoise partner Robert Kaplan. 

Top 10 Cybersecurity Steps to Take Now

Sutherland law firm partner Brian Rubin shares the most urgent cybersecurity steps for investment advisers.

Top Marketing Problems … and Solutions

Get solutions for the top marketing challenges that advisers face from ACA Compliance Group managing director Kimberly Daly

Watch Out for 5 Cybersecurity Myths

ACA Aponix Director Pascal Busnel on the most common cybersecurity myths that may cause firms to spend resources where they may not be needed.

The Hidden Costs of Non-Compliance

Proskauer law firm partner and former SEC Division of Investment Management deputy director Robert Plaze on why the costs of non-compliance go way beyond an SEC penalty.

CCO Liability: How to Protect Yourself

Find out from Blue Edge Capital CCO Margaret Fretz what chief compliance officers may be liable for and best practices to make sure you are protected.

Ethics or Compliance: Making the Choice

Find out the difference an ethics, rather than a compliance, perspective makes at an advisory firm from former Ethics and Compliance Officer Association COO Timothy Mazur.