Kelley Howes

Firm/Organization: Morrison & Foerster LLP

Blogs: IM Insights, MoFo ReEnforcement: The Enforcement Blog

Latest Articles

OCIE Provides Cybersecurity Best Practices Identified in Examinations

By Kelley Howes, Murray Indick, Kristen Mathews & Tiffany Quach

February 6, 2020

Cybersecurity has been a key priority for the SEC and its Office of Compliance Inspections and Examinations (OCIE) in recent years. The OCIE regularly releases publications addressing cybersecurity risks and practices, including eight risk alerts related to cybersecurity since 2012. In the latest example, OCIE recently published its Cybersecurity and Resiliency Observations Report, describing 34 best practices culled from its assessment of thousands of past examinations of SEC registrants. In this client alert, we highlight the…

IM Insights

2019 SEC Regulatory Summary – Advisers and Funds

By Kelley Howes & Susan Gault-Brown

January 2, 2020

Before closing the books on 2019, registered investment advisers and funds should take a look back at the activity undertaken by the SEC and its staff in the past year and carefully consider steps to be taken to implement new and amended regulations adopted by the SEC throughout the year. The start of a new year is also a good time to evaluate what remains on the SEC’s regulatory agenda. Click here to read more.…

IM Insights

SEC Proposes to Update Longstanding Investment Adviser Advertising and Solicitation Rules

By Kelley Howes & Susan Gault-Brown

November 13, 2019

The Securities and Exchange Commission (SEC) proposed amendments to both the advertising rule and the cash solicitation rule under the Investment Advisers Act of 1940 (the “Advisers Act”) on November 4, 2019. Neither rule — adopted in 1961 and 1979, respectively — has been amended significantly since it was adopted, although the SEC and its staff have, from time to time, granted no-action relief and otherwise interpreted the application of these rules. According to the…

IM Insights

SEC Clarifies Investment Adviser Standard of Conduct

By Kelley Howes & Susan Gault-Brown

June 25, 2019

On June 5, 2019, the SEC issued an Interpretive Release designed to “reaffirm, and in some cases clarify, the standard of conduct that investment advisers owe to their clients.” The Interpretive Release highlights existing principles relevant to an adviser’s fiduciary duty; it does not create any new regulation. The Interpretive Release sets forth the SEC’s views on the application of Section 206 of the Investment Advisers Act of 1940 (the “Advisers Act”) to SEC-registered advisers, state-registered…

IM Insights

New SEC Privacy and Cybersecurity Risk Alert Tells Broker Dealers and Investment Advisers Common Deficiencies to Avoid

By Kelley Howes & Kristen Mathews

April 22, 2019

The SEC’s new Risk Alert provides valuable insight as to what the OCIE wants to see broker dealers and investment advisers accomplish with their privacy notices and their cybersecurity policies and procedures. The SEC wants this written documentation to be comprehensive, to accurately reflect the registrant’s practices, and to be implemented effectively throughout their business. Broker dealers and investment advisers can, and should, use this Risk Alert to benchmark their own specific practices against the…

IM Insights

SEC Announces Settlements Resulting from the Share Class Selection Initiative

By Kelley Howes

March 13, 2019

On March 11, 2019, the SEC announced settlements with 79 investment advisers who self-reported violations of the Investment Advisers Act of 1940 (the “Advisers Act”) in connection with the Division of Enforcement’s Share Class Selection Disclosure Initiative (the “Share Class Initiative”). The advisers, collectively, agreed to return more than $125 million in fees and prejudgment interest to clients. Form ADV requires investment advisers to make full and fair disclosure to their clients and prospective clients concerning…

IM Insights

The SEC Continues to Spread Sunshine on Private Equity: Reflections on Two Recent Enforcement Actions

By Kelley Howes, Stephanie C. Thomas, Susan Gault-Brown & Michael Birnbaum

January 30, 2019

The end of 2018 was notable for two SEC enforcement actions against private equity fund managers for violations of the Investment Advisers Act of 1940 arising from improper allocations of expenses, undisclosed conflicts of interest, and insufficient compliance policies and procedures. The two actions demonstrate the SEC’s continued focus on private equity fund managers’ use of “operating partners” or consultants and the particular issue of how the expenses of such operating partners or consultants are…

IM Insights

FINRA’s 2019 Risk Monitoring and Examination Priorities Letter Highlights Broker-Dealer Online Distribution Platform Activities

By Kelley Howes, Hillel Cohn & Susan Gault-Brown

January 28, 2019

FINRA recently published its 2019 Risk Monitoring and Examination Priorities Letter (“Priorities Letter”) highlighting topics upon which FINRA will focus in the coming year. Unlike letters in prior years, the Priorities Letter focuses primarily on areas that FINRA considers to be material new priorities. Of particular interest to the growing number of companies providing financial services through an online platform is the first materially new priority highlighted by FINRA in its Priorities Letter—online distribution platforms…

IM Insights

Beware of Texting While Advising: OCIE Issues an Electronic Messaging Risk Alert

By Kelley Howes & Susan Gault-Brown

January 22, 2019

In December 2018, the Securities and Exchange Commission’s Office of Compliance Inspections and Examinations (OCIE) published its fifth and last risk alert of 2018 on the topic of electronic messaging by personnel of registered investment advisers. In the alert, OCIE focuses its attention on the growing use by advisory personnel of various types of electronic messaging for business-related communications and seeks to provide suggestions to advisory firms on ways firms can continue to meet their…

IM Insights

OCIE Publishes 2019 Enforcement Priorities

By Kelley Howes

January 4, 2019

The SEC’s Office of Compliance Inspections and Examinations (OCIE) published its 2019 examination priorities on December 20, 2018. Although OCIE’s published priorities “provide a preview of key areas where OCIE intends to focus its limited resources,” registrants should be aware that OCIE will proactively seek insight into evolving markets “including changes in risks to markets and investors,” and that its examination program will continue to be refined based on its evaluation of such risks. Registered investment advisers,…

Kelley Howes

OCIE Provides Cybersecurity Best Practices Identified in Examinations

2019 SEC Regulatory Summary – Advisers and Funds

SEC Proposes to Update Longstanding Investment Adviser Advertising and Solicitation Rules

SEC Clarifies Investment Adviser Standard of Conduct

New SEC Privacy and Cybersecurity Risk Alert Tells Broker Dealers and Investment Advisers Common Deficiencies to Avoid

SEC Announces Settlements Resulting from the Share Class Selection Initiative

The SEC Continues to Spread Sunshine on Private Equity: Reflections on Two Recent Enforcement Actions

FINRA’s 2019 Risk Monitoring and Examination Priorities Letter Highlights Broker-Dealer Online Distribution Platform Activities

Beware of Texting While Advising: OCIE Issues an Electronic Messaging Risk Alert

OCIE Publishes 2019 Enforcement Priorities

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