SEC Reminds Fund Advisors to Review – Gifts and Entertainment Policies

What’s Happening: The SEC recently issued a Guidance Update reminding mutual fund investment advisors (Advisors) that the receipt of gifts or entertainment by fund advisory personnel from persons doing business or hoping to do business with the fund may violate section 17(e)(1) of the 1940 Act. While most Advisors’ Codes of Ethics address this practice,… READ MORE

Activity in Low Priced Stocks Poses Operational Risks

By: George Jennison FINRA handed out one of its largest fines ever last year to a firm claiming that it ignored its Anti-Money Laundering obligations when accommodating client activity in low priced stocks. That $8 million fine was not levied against a broker-dealer operating a boiler room operation in penny stocks, rather it was levied… READ MORE

When Reviewing Books & Records, Don’t Forget About Data Destruction

The beginning of a new year is often when compliance officers assess whether the firm is meeting basic compliance requirements. Whether it is part of your annual 206(4)-7 or 3120 testing, making sure your records are in order is a basic requirement. Many firms retain records long past their regulatory requirements. When asked, firms often… READ MORE