Insights

Investment advisers registered with the U.S. Securities and Exchange Commission (SEC) or with a state as well as commodity pool operators (CPOs) and commodity trading advisors (CTAs) registered with the U.S. Commodity Futures Trading Commission (CFTC) are subject to important annual compliance obligations. This summary sets forth the primary obligations of which SEC-registered advisers should be aware.

On June 30, 2020, the Security and Exchange Commission's Regulation Best Interest (Reg BI) goes into effect for broker-dealers, registered investment advisers, and dual registrants to enhance the transparency and quality of investors' relationships. But that's just the beginning of the journey. This article contains details about available Deloitte resources to help our clients implement the Reg BI rule in their firms.

After BlackRock Chairman Larry Fink's revelations about the asset manager's renewed push for sustainable investments, State Street released its own prerogative to companies, announcing it would begin to vote against board members at companies that didn't follow environmental, social and governmental practices. The reason, especially for underperforming funds, is State Street found that "shareholder value is increasingly being driven by issues such as climate change, labor practices, and consumer product safety."

Last week, five federal financial regulatory agencies invited public comment on a proposal to modify regulations implementing the Volcker rule's general prohibition on banking entities investing in or sponsoring hedge funds or private equity funds - known as "covered funds." Since the regulations implementing the Volcker rule were finalized in 2013, the rule has created compliance uncertainty and imposed limits on certain banking services and activities that the Volcker rule was not intended to restrict. To address these concerns, the agencies simplified requirements for the proprietary trading restrictions in November 2019. This proposal would modify the restrictions for banking entities investing in, sponsoring, or having certain relationships with covered funds.