SEC Adviser Exams Find Widespread Violations of Custody Rule


The SEC’s Office of Compliance Inspections and Examinations reports finding widespread compliance deficiencies related to custody of securities. In its March 4, 2013 National Exam Program Risk Alert, OCIE said that approximately one third of its examinations of registered investment advisers revealed significant deficiencies.

As a result of these findings, OCIE referred violations to the SEC’s Division of Enforcement where appropriate.


OCIE previously identified compliance with Rule 206(4)-2 under the Advisers Act (the “Custody Rule”) as a priority area for purposes of its National Exam Program (NEP) (see our recent client alert regarding 2013 examination priorities). Nonetheless, recent NEP compliance examinations uncovered “widespread and varied” compliance deficiencies, which it grouped into four general categories...

Please see full alert below for more information.

LOADING PDF: If there are any problems, click here to download the file.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Morrison & Foerster LLP | Attorney Advertising

Written by:


Morrison & Foerster LLP on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:

Sign up to create your digest using LinkedIn*

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.

Already signed up? Log in here

*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.