As we enter a new year, many of us are making plans to grow and strengthen our businesses. For investment advisers, that should mean incorporating compliance best practices, particularly in light of the increased regulatory scrutiny predicted for 2012.
The North American Securities Administrators Association’s (NASAA) updated series of recommended best practices is a great place to start. It outlines a number of compliance practices that investment advisers should consider to minimize the risk of regulatory violations. They were developed after a series of coordinated examinations of investment advisers by 45 state and provincial securities examiners revealed a number of significant problem areas.
Based on the results of the 2011 coordinated exams, NASAA recommends the following “Best Practices” as a guide to assist advisers develop compliance practices and procedures.
- Review and revise Form ADV and disclosure brochure annually to reflect current and accurate information.
- Review and update all contracts.
- Prepare and maintain all required records, including financial records.
- Back-up electronic data and protect records.
- Document all forwarded checks.
- Prepare and maintain client profiles.
- Prepare a written compliance and supervisory procedures manual relevant to the type of business to include business continuity plan.
- Prepare and distribute a privacy policy initially and annually.
- Keep accurate financials. File timely with the jurisdiction.
- Maintain surety bond if required.
- Calculate and document fees correctly in accordance with contracts and ADV.
- Review all advertisements, including website and performance advertising, for accuracy.
- Implement appropriate custody safeguards, if applicable.
- Review solicitor agreements, disclosure, and delivery procedures.
Eckerle Law offers a highest-quality and cost-effective alternative to the traditional law firm model for a wide variety of transactional and regulatory matters serving all your business law needs. Our experienced attorneys also provide a full range of compliance services for investment advisers, offering compliance tools that are tailored to fit the ever changing regulatory landscape as well as your business needs.
If your company would like to strengthen its business practices, please contact us today so we can leverage our experience to create real-life business and legal solutions to help your business thrive.