March 27, 2024
Contact: IAA VP of Communications & Marketing Janay Rickwalder.
Registration and regulation of investment advisers is generally divided between the SEC and the States. Advisers with under a certain threshold in assets under management are prohibited from registering with the SEC unless an exemption exists. One of these exemptions from the prohibition is the so-called “internet adviser” exemption, which was adopted in 2002 to allow advisers that provided advisory services through the internet to register with the SEC regardless of the amount of their AUM.
Today’s amendments are intended to update the internet adviser exemption. They will allow SEC registration for advisers that offer their advisory services exclusively through an interactive website, which basically means that these advisers won’t be allowed to have any non-internet clients. Today, these advisers can have up to 15 non-internet clients.
The amendments narrow and provide clarity around the exemption, but their impact is likely to be very modest since only a small number of advisers rely on the exemption today (around 250) and even fewer are likely to rely on it as amended.
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