DC Circuit finds negligent, but not willful fraud for inadequate disclosures

In a much-anticipated decision, on April 30, 2019, the US Court of Appeals for the District of Columbia Circuit issued its decision in Robare, a case that concerned an investment adviser’s (IA) disclosure of conflicts of interest regarding its receipt of payments from a custodian. The court held that the Commission’s findings of “negligent” violations under Section 206(2) were supported, but the Commission’s findings of “willful” violations under Section 207, based on the same negligent conduct, “are erroneous as a matter of law.”

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OCIE Lists Privacy Blunders; SEC Explains When Digital Assets become Securities; Ohio Mandates IARs and RR to Report Elder Abuse; FINRA Gives Broker an “F” in Email Review; and Google Searches Don’t Count as Due Diligence

Regulatory Updates from Jaqueline Hummel at Hardin Compliance Consulting LLC.

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The emerging patchwork of fiduciary investment advice regulation – Putting the pieces together

By all accounts, 2019 will see the advancement of a number of fiduciary and best interest investment advice regulations at both the federal and state levels. Firms subject to these regulations will face challenges in dealing with rules that will impose a host of new obligations, and that may overlap and conflict with one another. Eversheds Sutherland has developed a chart that is intended to help firms take stock of the evolving framework and aid firms in putting the pieces together.

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SEC Asks for Help Understanding Digital Assets and Custody Rule, FINRA Issues FAQs on 529 Self-Reporting Request, and New Testing for Swap Traders

Regulatory Updates from Jaqueline Hummel at Hardin Compliance Consulting LLC.

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How I Learned to Stop Worrying and Learned to Love Form ADV

After last year’s material amendments to the Form ADV, investment advisers can breathe a sigh of relief; the SEC made no changes to the form this year. That said, completing the Form ADV remains a major data-gathering project with important regulatory implications. So, take a few deep cleansing breaths and read our tips for completing your annual update.

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