Wrap Fee Programs

SEC Crackdown on Wrap Fee Programs Nets Two More Advisers

The SEC isnt slowing down in its enforcement campaign against dually registered advisers/broker-dealers offering wrap fee programs when those advisers charge fees in addition to the annual wrap fee. This is particularly true when the additional fees are generated by subadvisers who "trade away" transactions to non-affiliated broker-dealers.

Wrap Fee Programs: Best Execution No Defense if Trade Aways Not Disclosed

Best execution, best execution, best execution. Those two words are pounded into the minds of advisers and their trading desks so that clients receive the best deals possible. But they apparently made little difference to the SEC, which settled with a wrap fee program subadviser for failing to adequately disclose the frequency of trades it sent to non-affiliated brokers - even though the subadviser said those trades resulted in lower execution costs.

Getting Practical With GIPS: Tricks and Traps For Advisers to Watch For

No one ever said that GIPS compliance is easy.

Weaker Due Diligence on Proprietary Funds Lands Wrap Sponsor in Hot Water

The SEC has sued a wrap fee program sponsor for failing to disclose that it made exceptions to its stated due diligence process in order to offer two proprietary funds on its wrap platform. The two funds would not have made the usual due diligence cut. The SECs May 1 order named two of Bank […]

Donohue Cautions Advisers On Wrap/UMAs, Derivatives

Unified managed accounts (“UMAs”), wrap accounts (a.k.a. “separately managed accounts” or “SMAs”), and other “managed accounts” create challenges for compliance officers as well as for the SEC, according to Division of Investment Management director Buddy Donohue. In a luncheon address at last weeks IAA/IA Week conference, Donohue pointed out that in managed accounts, the people […]

Best Ex Depends on Facts and Circumstances, Say Experts

Best execution can mean different things for different types of clients and different types of trades. That was the theme of a panel discussion on best ex at last months ALI-ABA investment adviser conference. Depending on the type of client, explained Steven Yadegari, general counsel of Cramer Rosenthal McGlynn, a firm may use the same […]

New Exam Request List Beefs Up Wrap Fee Inquiries

Heres an SEC document request list used in an adviser exam last month by the SECs Chicago Regional Office. A close read of the list reveals several items of interest: Wrap fee programs. In comparison to another version of the exam list used just a few months ago, last months list requests six new items pertaining […]

SEC Staff Fixes Dual Registrant Bunched Confirm Problem

Ever since the Division of Market Regulation dropped a footnote in its 2005 letter to Morgan Keegan “clarifying” the scope of the relief in its 1999 letter to Money Management Institute/Securities Industry Association, dual registrants that sponsor wrap programs have had to obtain their own firm-specific relief in order to suppress trade-by-trade confirms for wrap […]

Wrap Fee Compliance: Beyond Rule 3a-4

Sure, youve ticked through the seven items required by ICA Rule 3a-4. But to best prepare for the SECs upcoming wrap fee sweep exam, youll want to consider a host of broader issues. To help you along, here are the highlights of the wrap fee panel at last months IAA/IA Week conference. The panel featured […]

SEC Plans New Wrap Fee Sweep

The SEC examination staff is planning to conduct a new sweep focusing on wrap fee program best execution, suitability, and disclosure issues, as well as basic ICA Rule 3a-4 compliance. SEC associate director Robert Plaze announced the pending sweep while speaking on a panel on wrap fee accounts at the recent IAA/IA Week conference. “At […]

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.