SEC Withdraws Certain COVID Relief for Funds, Issues Report on Prime Money Market Fund Activity at Onset of Pandemic

The SEC’s Division of Investment Management is terminating an exemptive order and withdrawing two no-action letters that were issued in March 2020 as part of the SEC’s response to the COVID-19 pandemic, effective April 30, 2021. The Division has also issued an analysis of prime money market funds at the onset of the pandemic during a period of significant market volatility in March 2020.
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FSOC Meeting Focuses on Hedge Funds, Mutual Funds, Impact of Climate Change on Financial Stability

The Financial Stability Oversight Council’s (FSOC’s) first meeting of the year – and of the new Administration – focused on hedge funds, mutual funds, and climate change. Treasury Secretary Janet Yellen, who chairs FSOC, announced that FSOC’s Hedge Fund Working Group will reconvene to enhance data sharing among agencies and to improve FSOC’s “ability to identify, assess, and address potential risks to financial stability related to hedge funds.” The open session of the meeting included a presentation by Federal Reserve Board staff on climate change and its potential impact on financial stability and a discussion of actions by the FSOC agencies to address climate change risks.
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One Year into COVID | CCOs Reflect on Lessons Learned

It has been almost exactly one year since the COVID pandemic pushed investment advisers into a virtual work environment – virtually overnight. At the 2021 IAA Compliance Conference, a panel of CCOs and their counsel reflected on what the transition to “work from home” has meant for their work and their firms.
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SEC Requests Comment on Money Market Fund Report

The SEC is requesting public comment on potential reforms for money market funds that were discussed in a report by the President’s Working Group on Financial Markets (PWG). The PWG report describes the outflows in March 2020 from prime and tax-exempt money market funds, steps taken to support short-term funding markets despite previous money market fund reform efforts, and potential reform measures.
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SEC Requests Feedback on Money Market Fund Report

The SEC’s Division of Investment Management is seeking feedback on a report by the President’s Working Group on Financial Markets (PWG) on the effects of the March 2020 market volatility on money market funds and short-term funding markets. The report provides background information on money market funds and prior regulatory reforms, events in the short-term funding markets in March, and potential measures that regulators could consider to improve the resilience of money markets funds and short-term funding markets. 
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SEC’s Investor Advisory Committee Adds New Members

The SEC’s Investor Advisory Committee (IAC) recently met to discuss corporate disclosure during COVID-19 and the implications of the pandemic for the upcoming proxy season. The IAC also announced the following new officers:
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FSOC Expresses Concerns with Fund Leverage and Redemptions

Calls on SEC to Study Potential Emerging Risks from Investment Funds

Not surprisingly, the 2020 annual report of the Financial Stability Oversight Council (FSOC) looks at the risk to the U.S. financial system through the lens of the unprecedented economic turmoil wrought by the COVID-19 pandemic. This article focuses on the report’s observations relating to asset management and funds.
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SEC Amends Rules to Facilitate Electronic Submission of Filings

In a move strongly supported by the IAA, the SEC has taken two further actions acknowledging the widespread use of electronic signatures (e-signatures) and related technological developments, as well as the continuing need to support remote workforces. Earlier this year, the SEC staff had provided limited temporary relief regarding the use of e-signatures in response to the COVID-19 pandemic. However, the IAA and others in the industry have advocated in recent months for the SEC to provide additional permanent flexibility regarding the use of e-signatures in SEC filings.
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SEC IM Director Dalia Blass Reflects on Division’s Work

In a recent speech, the SEC’s Division of Investment Management Director Dalia Blass reflected on the Division’s hard work and accomplishments throughout the year. She praised her staff’s hard work throughout the COVID-19 crisis, including its response to the pandemic’s market disruptions and engagement with market participants on a number of important issues. 
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SEC’s AMAC Recommends Switch to E-Delivery Default, More to Address Operational Issues Relating to COVID-19

The SEC’s Asset Management Advisory Committee (AMAC) has made preliminary recommendations to address COVID-19-related operational issues, including electronic delivery, remote work, e-authorization, and dematerialization. The AMAC was formed to provide the SEC with diverse perspectives on asset management and related advice and recommendations.
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PPP Borrowers’ Names and Loan Amounts Must be Released, Court Says

In a lawsuit brought by news organizations and others, the U.S. District Court for the District of Columbia has ordered the Small Business Administration (SBA) to publicly release the names, addresses, and loan amounts of recipients of Paycheck Protection Program (PPP) and Economic Injury Disaster Loan (EIDL) COVID-related loans.
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SEC Study Finds Credit Markets Largely Absorbed COVID-19 Risk, But Still Have a Way to Go

A new report by SEC staff seeks to identify the extent to which interconnectedness and related interdependencies in the U.S. credit markets contributed to or mitigated risk – including systemic risk – during the market stress brought on by the COVID-19 pandemic. The report generally concludes that while the markets were able to absorb a significant amount of shock, they are not yet out of the woods. SEC Chairman Jay Clayton and Chief Economist and Director of the Division of Economic and Risk Analysis S.P. Kothari summarized the key takeaways from the report.
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SEC’s FIMSAC Considers Impacts of COVID-19 on Fixed Income Markets

The SEC’s Fixed Income Market Structure Advisory Committee (FIMSAC) met on October 5 to discuss the impacts of the COVID-19 pandemic and other developments on the fixed income markets. The committee focused on the definition of electronic trading, the corporate bond market, the municipal securities market, bond funds, and ETFs. Panelists discussed the evolution of electronic trading and the benefits that the widespread availability of market data has provided, as well as the record number of users trading U.S. credit during the work-from-home transition as a result of the pandemic beginning in March.
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SEC Investment Management Director Blass Discusses Regulating for the Future

Using money market funds and exchange-traded funds (ETFs) as case studies, the SEC’s Division of Investment Management Director Dalia Blass discussed in a recent speech the Division’s philosophy of forward-looking regulation and its focus “on regulations that will balance flexibility to accommodate future changes with promoting resiliency to future crises.”
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AMAC Discusses ESG, Private Funds, Diversity and Inclusion, COVID-19 Impact

The SEC’s Asset Management Advisory Committee (AMAC) held a meeting on September 16. In his opening remarks, SEC Chairman Jay Clayton discussed his interest in promoting access and choice for Main Street investors to private markets while focusing on fees and investor protections. He also welcomed continued discussions on improving diversity and inclusion in the asset management industry. Regarding the panel on Diversity and Inclusion, Commissioner Hester Peirce asked the AMAC to consider the role that regulation may play in excluding people from participating in the industry.
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When It Comes to Reopening the Economy, HR is on the “Front Lines”

For months we have been celebrating the brave men and women on the "front lines" of this COVID-19 crisis. Doctors. Nurses. First responders. Even grocery store clerks. They've all earned our admiration, respect, and gratitude for the work they've done, often for very low pay and at great personal risk.

But as the nation now turns to the difficult task of re-opening the economy, getting people back to work, and ensuring the safety of America's labor force, I don't think it's an exaggeration to say that Human Resources professionals are now on the front lines of this battle. 
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Co-Director of Enforcement Steven Peikin to Leave SEC

The SEC has announced that Steven Peikin is leaving the SEC on August 14, 2020. Peikin has served as Co-Director of the SEC’s Division of Enforcement with Stephanie Avakian for more than three years. Avakian will remain Director of the Division. During their tenure, the SEC has brought thousands of enforcement actions that resulted in over $13.5 billion in disgorgement and penalties, and over $3.1 billion returned to harmed investors.
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FinCEN Provides Additional Guidance on Customer Due Diligence Requirements for Covered Financial Institutions, Issues COVID-19 Cyber Advisory

The Treasury Department’s Financial Crimes Enforcement Network (FinCEN) released additional frequently asked questions (FAQs) about customer due diligence (CDD) requirements for covered “financial institutions” under the Bank Secrecy Act. The CDD Rule applies to financial institutions including banks, broker-dealers, mutual funds, futures commission merchants, and introducing brokers in commodities.
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OCIE Issues Risk Alert Relating to COVID-19 Compliance Risk

The SEC examination staff has issued a Risk Alert highlighting select COVID-19 compliance risks and considerations for SEC-registered investment advisers and broker-dealers identified through industry outreach efforts and consultation with other regulators. OCIE’s observations and recommendations fall into six broad categories.
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IM Division Director Discusses E-Delivery, Increasing Public Access to Private Markets

Dalia Blass, Director of the SEC’s Division of Investment Management, recently gave a speech in which she focused on key past and future developments, and changes within the Division. She began by discussing the work of the Division related to COVID-19, and how the Division’s Analytics Office that was created after the 2008 financial crisis greatly improved the Division’s data handling capabilities. Regarding whether significant policy changes should be made as a result of recent events, Blass focused on fund liquidity and operational challenges.
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2020 Investment Management Compliance Testing Survey:
BCP Related to COVID-19 Now Top Compliance Concern

Business Continuity Planning related to COVID-19 is now the top concern of investment management compliance professionals – edging out Cybersecurity, which had headed their rankings of hot topics for six consecutive years.
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IRS Extends RMD Rollover Period to August 31, Provides Additional Guidance

The IRS issued a notice on June 23 regarding the CARES Act waiver of 2020 required minimum distributions (RMDs). Under the notice, anyone who already took an RMD in 2020 from certain retirement accounts may roll that money back into a retirement account.
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SEC Provides Relief Related to Mailing Adviser and Fund Documents to Clients in International Jurisdictions

The SEC’s Divisions of Investment Management and Trading and Markets have issued a statement providing no-action relief from failure to deliver certain international adviser and fund communications. The relief applies to clients – who have not consented to electronic delivery – who have international mailing addresses in jurisdictions where the U.S. Postal Service or other common carrier has temporarily suspended international mail service due to COVID-19. The relief will expire when the respective jurisdiction resumes mail delivery.
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Highlights from the IAA/CMS Trading and Best Execution Summit: Market Structure Changes and IAs’ Trading, Best Ex Obligations

The IAA’s second annual Trading and Best Execution Summit, cosponsored by Capital Markets Strategies, took place on June 18 in the midst of sweeping SEC initiatives designed to bring significant change to market structure and trading in the United States. The virtual event – attended by more than 300 mostly buy-side professionals – focused on how regulatory changes are likely to affect how investment advisers approach and manage their trading and best execution obligations and governance.
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Private Equity Liquidity Solutions in the Time of Coronavirus

Financing operations during a period of reduced revenues has been a challenge for many companies during the COVID-19 pandemic – including companies that are part of a private equity portfolio. Steps that private equity fund managers can take to manage portfolio financing needs and preserve financial flexibility were the focus of the recent IAA webinar Private Equity Managers and the COVID-19 Liquidity Crunch.
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More Individuals Qualified for CARES Act Coronavirus-Related Retirement Plan Distributions, Loans Under New IRS Guidance

Also Increases Loan Amounts, Includes Temporary Suspension of Repayments

The IRS has published guidance regarding CARES Act provisions on Coronavirus-related distributions and loans from retirement plans. The CARES Act provided relief from the 10 percent penalty and 20 percent mandatory withholding on “Coronavirus-related distributions” of up to $100,000 from retirement plans and IRAs. It also provided for an increase in retirement plan loans and a temporary suspension of loan repayments.
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SEC Extends Relief for In-Person Board Meetings

Declines to Extend Form ADV and Other Filing, Delivery Requirements

The SEC has issued an order that extends the time for relief from the in-person fund board meeting requirement until no earlier than December 31, 2020. This order supersedes the SEC’s prior order that extended this relief until August 15, 2020. The IAA has strongly advocated on behalf of our members for the extension of this relief.
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Clayton Urges Increased Care for Retail Investors in Wake of Pandemic

Also Confirms June 30 Reg BI, Form CRS Compliance Date

Saying the effects of the COVID-19 pandemic “weigh substantially in favor of implementing Reg BI and Form CRS requirements as soon as practicable,” SEC Chairman Jay Clayton confirmed in a recent public statement that the June 30 compliance date for Form CRS and Regulation Best Interest (Reg BI) remains in effect. He also expressed strong concerns about the marketing of certain investments and strategies to retail investors, who may have a greater need for cash due to the pandemic. He calls on firms to focus on several areas to make sure that they are providing advice in the best interest of retail investors.
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Trump Signs Legislation to Relax PPP Restrictions After Congress Passes Measure Overwhelmingly

Several restrictions on companies that borrow money through the Paycheck Protection Program have been relaxed under legislation approved unanimously in a Senate voice vote and by a 417-1 vote in the House.  Rep. Dean Phillips (D-Minn.) introduced the bill, called the “Paycheck Protection Program Flexibility Act,” on May 26 with 35 cosponsors, including 17 Republicans. President Trump signed the bill into law on June 5.
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SEC Provides No-Action Relief Related to Participation in Fed Lending Facility

The SEC’s Division of Investment Management has issued a no-action letter related to participation in the Federal Reserve Board’s 2020 Term Asset-Backed Securities Loan Facility, or TALF 2020.

The staff reaffirmed two no-action letters issued in 2009 to Franklin Templeton and T. Rowe Price that related to participation in the Fed’s TALF 2008, established in response to the financial crisis.
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Executive Order Calls on Agencies to Promote Economic Recovery By Providing Regulatory Exemptions, Recognize Good Faith Compliance

President Trump has issued an executive order calling on federal agencies to rescind, modify, waive, or provide exemptions from regulations or requirements that may inhibit economic recovery. More specific suggestions include temporary enforcement discretion and providing extensions of time in order to promote job creation and economic growth.
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SEC’s AMAC Discusses COVID-19 Impact, Outlines ESG, Private Investment Work Streams

In its second meeting since its formation, the SEC’s Asset Management Advisory Committee (AMAC) met on May 27 to discuss the effects of COVID-19 on the asset management industry and to review the work streams of its ESG and Private Investment Subcommittees.
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SEC Enforcement and COVID-19: How Lessons from the Financial Crisis Apply Today

By Amy Greer, Jennifer Klass, Peter Chan, A. Valerie Mirko and Kurt Oldenburg, Baker & McKenzie LLP*


Based on public statements, including a recent speech discussing the operation of the Division of Enforcement’s COVID-19 Steering Committee, it is clear that the SEC Enforcement Staff is already thinking ahead to the types of enforcement investigations and actions that may follow the COVID-19 Crisis. In doing so, the Staff likely will draw on its experience following the 2008 global financial crisis to identify potential patterns of misconduct that occur during periods of extraordinary market volatility and financial stress.  This column discusses the various areas that the SEC Enforcement Division is currently focused on, as well as our analysis of the enforcement actions arising out of the 2008 Crisis, with a particular focus on the asset management industry.
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SEC COVID-19 Market Monitoring Group Update

Following inquiries about its work, SEC Chairman Jay Clayton and Chief Economist S.P. Kothari issued an update on the efforts  of the internal, interdisciplinary COVID-19 Market Monitoring Group (the Group) formed by the SEC in April, and now the focal point for managing and coordinating the SEC’s COVID-19-related efforts. The update focuses on (i) the status of ongoing coordination with domestic and foreign regulatory partners and public sector officials, and (ii) certain market analysis work streams.
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Fed Report Says COVID-19 Biggest Risk to Economy, Financial System, Says Public Health Measures to Contain Coronavirus Crucial

The future course of the COVID-19 pandemic – and the size and duration of its economic fallout – are the most significant risks to the U.S economy and financial system, the Board of Governors of the Federal Reserve system says in its new Financial Stability Report.

Whether the risks they pose become realities will depend largely on the success of public health measures and other government actions to contain the spread of COVID 19, according to the Fed. Steps households and business take to resume economic activity, supported by government efforts and policy actions, “may ameliorate the most adverse potential outcomes.”
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Fed Survey: COVID-19, Global Policy Response Biggest Financial Stability Threats for Next 12-18 Months

From early February to mid-April, Federal Reserve staff surveyed 22 contacts at banks, investment firms, academic institutions, and political consultancies to gather their views on risks to U.S. financial stability. Concerns regarding the scope and duration of the COVID-19 pandemic—and its economic and financial effects—featured prominently.
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SBA Extends Safe Harbor to Return PPP Loans to May 18, 2020

Additional Guidance on Loans under $2 million, More Flexibility on Loan Amounts

The Small Business Administration (SBA) has issued new FAQ 47 on the Paycheck Protection Program (PPP) that extends the safe harbor deadline to return PPP loans from May 14 to May 18, 2020, presumably to allow borrowers time to consider the implications of just-released SBA guidance.

This extension follows a new SBA safe harbor announced yesterday in SBA FAQ 46 that explained that, for PPP loans (including those made to affiliates) totaling less than $2 million, the SBA will not review the borrower’s certification for good faith, but will instead deem the certification to have been made in good faith. The SBA is also permitting more flexibility for the loan amount in certain circumstances, provided that the lender has not already filed its SBA Form 1502 for the PPP loan.
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IRS Issues FAQs on CARES Act Retirement Plan, IRA Provisions

Upcoming Guidance to be Consistent with 2005 Katrina Guidance

The IRS has issued new FAQs on CARES Act provisions related to retirement plans and IRAs. The IRS and the Treasury Department are also developing additional CARES Act guidance, to be released in the near future, that will be similar to guidance that applied to the treatment of distributions and plan loans by victims of Hurricane Katrina.
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DOL Issues COVID-19 Relief from ERISA Deadlines for Plans and Participants

The Department of Labor (DOL) has provided relief from certain deadlines under ERISA “to help employee benefit plans, plan participants and beneficiaries, employers and other plan sponsors, plan fiduciaries, and other service providers impacted by the coronavirus outbreak.” The relief in the notices supplements other guidance provided by DOL and the IRS in connection with COVID-19. The notices are effective immediately upon publication.
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New SEC Guidance on Adviser PPP Loans and Form ADV Reporting;
SBA Clarifies that Hedge Funds, Private Equity Firms Not Eligible for PPP

New SBA FAQ Focuses on Businesses Owned by Companies with Sources of Liquidity;
Advisers Should Keep Current with Frequently Changing Official PPP Guidance 

The SEC has issued new guidance on disclosure requirements for investment advisers applying for and receiving Paycheck Protection Program loans, while the Treasury Department and Small Business Administration (SBA) have decided that hedge funds and private equity firms are not PPP-eligible and have raised questions about the eligibility of businesses owned by companies with sources of liquidity.
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SEC Creates COVID-19 Market Monitoring Group 

The SEC has formed an internal, cross-divisional COVID-19 Market Monitoring Group to assist agency officials with actions and analyses related to the effects of COVID-19 on markets, issuers and investors, and to respond to requests for information and assistance from other regulators and public sector agencies. 

The COVID-19 Market Monitoring Group will coordinate with staff in the Divisions of Economic and Risk Analysis (DERA), Trading and Markets, Investment Management,  and Corporation Finance, the Offices of Municipal Securities, Credit Ratings,  Compliance Inspections and Examinations, International Affairs, the Chief Accountant, and the SEC’s Activities-Based Monitoring Committee.
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The FSB Reacts to COVID-19’s Shock to the Financial System 

On April 11, the Chair of the Financial Stability Board (FSB) sent a letter to the G20 Finance Ministers and Central Bank Governors updating them on the FSB’s actions to maintain financial stability given ongoing and emerging risks to the global financial system brought on by the COVID-19 crisis. FSB Chair Randal K. Quarles pointed to the FSB’s efforts to:
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New SEC Staff Resource for COVID-19 FAQs

The SEC’s Division of Investment Management has created a new web page –Division of Investment Management Coronavirus (COVID-19) Response FAQs – that consolidates the FAQs and other relief and guidance relevant to investment advisers and funds that the SEC and its staff have issued related to the COVID-19 pandemic. The web page is formatted in a helpful Q&A that lists responses to questions about advisers and funds affected by COVID-19.
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Division of Investment Management Updates Hearing Request Procedures for Applications

In light of the disruptions caused by COVID-19, the SEC’s Division of Investment Management has issued an Information Update on changes to procedures for filing hearing requests on Investment Company Act and Investment Advisers Act applications.
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SEC Says No to Extending Form CRS, Reg BI Deadlines

IAA Expresses Disappointment on Form CRS

The SEC has declined to extend the filing and delivery deadlines for the new Form CRS and the implementation date for new Regulation Best Interest. IAA President & CEO Karen Barr expressed surprise that the SEC would not be providing relief from the Form CRS deadline in light of the business disruptions caused by the coronavirus pandemic – and pointed to IAA resources to help investment advisers meet their June deadline for Form CRS.
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IAA Schedules Series of Coronavirus-Related Webinars

We have launched a series of webinars relating to COVID-19 impacts on your businesses and regulatory obligations, covering such issues as answering clients’ portfolio questions, adviser disclosures, best execution and trading, LIBOR transition, the impact of the new CARES Act on advisers and their clients and more. As these webinars take place, recordings of the webinars – complimentary to IAA members – become available on our website. New webinars are added frequently. All upcoming webinars are announced via email, on the IAA Today homepage, and in the Calendar section of the IAA website’s homepage.
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BCBS, IOSCO Delay Upcoming Compliance Dates for Initial Margin
for Uncleared Derivatives by One Year

Responding to a request by the IAA and other trade associations, the Basel Committee on Banking Supervision (BCBS) and the International Organization of Securities Commissions (IOSCO) have extended by one year the deadline for completing the final two implementation phases of the initial margin (IM) requirements for non-centrally cleared derivatives (Uncleared Margin Rules).
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CARES Act Provisions Related to Retirement

The Coronavirus Aid, Relief, and Economic Security Act (the CARES Act) includes a number of provisions related to retirement that are of importance to investment advisers and their clients. For defined contribution plans and individual retirement accounts (IRAs), there is relief from required minimum distribution requirements and early distributions. There are also changes in provisions related to loans from retirement plans, and some short-term funding relief to certain defined benefit plans. Finally, additional flexibility is provided to the Secretary of Labor related to ERISA deadlines.
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IAA Urges Congress to Restore, Expand Deduction
for Investment Advice in Next Stimulus Package

Short Legislative Horizon Requires Adviser Grassroots Support Now

The IAA is urging Congress to restore and expand the deduction for advisory fees when it considers a “phase 4” stimulus package in response to the COVID-19 crisis. Congress is in recess until April 20 and will begin consideration of another stimulus bill upon its return.

As noted in the one-pager we distributed to key lawmakers and their staffs, the repeal of this deduction may have appeared inconsequential in light of 2017’s rising stock market, sustained job growth and real wage growth. But today, Americans are deeply troubled by stock market volatility, the business environment and the state of their personal household finances. Access to professional financial advice is critically important in these turbulent times.

The IAA is asking advisers to use our Contact Congress tool to send emails of support to their federal legislators. It is our understanding the House Committee Chairs will be making recommendations for the next stimulus package’s provisions by Friday, April 10 – so the time to act is now.
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March 25 Coronavirus Regulatory Updates 

SEC Extends Relief for Adviser Filing Deadlines, Eases Conditions
Extends Relief for Fund Filing Deadlines and Board Meetings
Adds Flexibility for Obtaining Short-Term Funding, IFL Arrangements
NFA Extends Regulatory Relief for CPOs and CTAs

The latest expansions of regulatory relief in response to the coronavirus pandemic.
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IAA Adds New Charts Detailing Relief to Coronavirus Response Resources

To help members keep abreast of new filing deadlines and other Coronavirus-related regulatory relief, the IAA has added two new charts to its Coronavirus Response Resources web section. One is a quick reference guide – At a Glance: New Adviser Filing Deadlines Under SEC Orders Related to COVID-19. The second – IAA COVID-19 Relief Resource Chart – is a more comprehensive chart detailing relief measures, including required conditions to relief and convenient links to the original regulatory source, from a broad range of regulators.


OCIE Moves Most Examinations Off-Site, Assures Advisers Reliance on Coronavirus-Related Regulatory Relief Will Not Trigger Exams

The SEC’s Office of Compliance Inspections and Examinations (OCIE) has issued a statement announcing that because of health, safety, and firm operations disruption concerns, OCIE has moved to conducting examinations off-site through correspondence unless it is “absolutely necessary” for its teams to be on-site. Recognizing that firms are focused on maintaining operations and ensuring the safety of their employees, OCIE is working with registrants on timing, availability of personnel, and other ways to minimize disruption.

The statement also assures advisers that a firm’s reliance on regulatory relief provided by the SEC will not be a risk factor utilized in determining whether OCIE commences an examination. OCIE “encourage[s] registrants to utilize available regulatory relief as needed.”
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CFTC, NFA Provide Filing Delays for CPOs and CTAs

In response to the coronavirus pandemic, the CFTC’s Division of Swap Dealer and Intermediary Oversight (DSIO) issued a no-action letter providing blanket relief to commodity pool operators (CPOs), temporarily extending the filing deadlines for Form CPO-PQR, Pool Annual Reports, and Pool Periodic Account Statements under Rules 4.27, 4.22 and 4.7. The National Futures Association (NFA) also provided filing deadline relief in its Notice to Members on March 23 for commodity trading advisors (CTAs) and CPOs.
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New SEC, CFTC Staff Guidance on Coronavirus-Related Issues

As the coronavirus continues to cause unprecedented challenges, the IAA has aggregated several breaking regulatory updates to keep you informed. These updates detailed in this article cover the SEC (Form ADV, Custody, Form CRS, comment letters) and the CFTC/NFA (reporting deadlines, BCP, branch office requirements). We continue to be in close communication with regulators to share your concerns and request appropriate relief.
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Navigating the Coronavirus Crisis

Advisers’ Crucial Role – and How the IAA is Supporting You

The impacts of the coronavirus pandemic on our members and our profession have been extremely challenging and disruptive – and it’s clear that the financial turmoil spawned by this health crisis is far from over. Americans are anxious about stock market volatility, a deteriorating business environment, and their own health and financial stability. There has never been a more important time for investment advisers to serve their clients with a calm and steady hand – and we will continue to play a critical role as the economic damage deepens, and the longer-term impact comes into sharper focus.

As the COVID-19 developments continue to unfold, the IAA stands ready to provide leadership, robust resources, and up-to-date information to help you navigate today’s disruptions and those to come. We will help you serve your clients, contributing to the stability of the markets and the economy as a whole.
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Recording of Member Call on Coronavirus-Related Issues Available

The IAA held a member call today with Partners Jason E. Brown and Joel Wattenbarger of IAA Associate Member Ropes & Gray to discuss considerations for firms in addressing a wide range of implications of coronavirus developments – BCP, regulatory filing obligations, disclosure, remote working arrangements and more. A recording of the call is now available.
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IAA Coronavirus Update

The IAA – like every other organization and business – is closely watching developments in the fluid coronavirus situation and is adapting its policies as events unfold.
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EU Countries Issue Temporary Short Selling Prohibitions

Calling it a precautionary action essential to enable authorities to monitor market developments during the coronavirus pandemic, the European Securities and Markets Authority (ESMA) has temporarily lowered its reporting threshold for short position holders.
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SEC Provides Targeted Relief from Forms ADV and PF Deadlines, In-Person Fund Board Meetings, Fund Filing Deadlines

The SEC has issued two orders providing targeted relief from filing and delivery deadlines for Form ADV and Form PF, from in-person board meetings for registered funds, and certain other funds. The IAA has been in ongoing communication with regulators and requested this relief in response to member concerns about ongoing disruptions caused by the coronavirus pandemic.

The SEC’s announcement is available at Up-to-date information about government and regulatory guidance in response to the coronavirus disruptions is available on the IAA’s Coronavirus Response Resources web page.
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SEC Extends No-Action Relief for Fund Board Meetings Due to Coronavirus,
Provides 45-Day Extension for Certain Corporate Filings

In response to the coronavirus, the SEC’s Division of Investment Management extended no-action relief that it provided in February 2019 from certain in-person voting requirements for fund directors. The SEC also issued an order granting an additional 45 days for certain filings by public companies and those required to make filings with respect to public companies that would have been due between March 1, 2020 and April 30, 2020.
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IAA Coronavirus Update

The IAA is closely watching developments in the fluid coronavirus situation and will adapt its policies as appropriate. At this moment, we are going forward with our planned events, which include our Trading, Best Execution, and Research Summit in New York on May 20 and our Adviser Advocacy Day in Washington, DC on June 11. The IAA is planning a member call to discuss considerations for firms in addressing various implications of the coronavirus developments. The SEC’s Division of Investment Management has asked the IAA to keep its staff informed of impacts that the coronavirus situation is having on our member firms and potential compliance relief that may be appropriate.
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SEC COMMISSIONER PEIRCE KEYNOTE AT 2021 IAA COMPLIANCE CONFERENCE–In her keynote conversation with IAA President & CEO Karen Barr, SEC. Commissioner Hester Peirce discussed her concerns about recent agency initiatives involving climate change and ESG initiatives and other challenges facing the SEC.

MORE IAA VIDEOS – including sessions with SEC officials at our 2021 Compliance Conference and videos on Diversity, Equity & Inclusion – are on our VIDEOS page.