SEC New Rule Impacting Investment Advisers
New rules under the Investment Advisers Act of 1940 affect investment advisers depending on status
SEC New Rule Impacting Investment Advisers
August 23, 2023, SEC adopted changes aimed primarily at non-registered and registered advisers (IAs) to private funds (Release Nos. IA-5955). New rules under the Investment Advisers Act of 1940 affect investment advisers depending on IA registration status and include, but not limited to:
• Registered IAs to provide more transparency to investors; • Registered IAs to provide quarterly statements and an audit mandatory since not all advisers are subject to the custody rule and even then, not necessarily required to obtain an audit; • Registered IAs and non-registered IAs (includes exempt reporting advisers) will be prohibited from engaging in certain sales practices, conflicts of interest, and compensation schemes contrary to protecting investors; • All registered IAs and non-registered IAs (includes exempt reporting advisers) will be prohibited from providing preferential treatment to certain investors in a private fund unless the adviser discloses such treatment to other current and prospective investors
Proposed one year transition period to comply
