Just a reminder that the deadline for payment of your firm’s annual renewal fees is December 12th. Don’t wait until the deadline to pay as the IARD system may take up to a week to process payments.

On November 2, 2011, the Massachusetts Securities Division proposed new regulations that would 1.) change the requirements for investment advisers with discretion or custody of client funds; 2.) change the definition of “institutional buyer” found in the regulations; and 3.) introduce a private fund exemption for investment advisers to some private funds.  For more information on these changes please visit the Division’s website at http://www.sec.state.ma.us/sct/sctnewregs_11_11/newregs_11_11_idx.htm.

The FINRA Entitlement Program provides authorized users a secure means to access participating applications with a single user ID and password. Once an investment adviser (IA) firm completes the entitlement process, it will obtain access to the IARD system in order to register or file as an exempt reporting adviser via this secure system.

The Entitlement Program requires that each firm designate a Super Account Administrator (SAA), who will have the authority to create, modify and delete account administrator and user accounts for most FINRA applications.

One of the responsibilities of a SAA is to ensure that users in their organization are properly entitled to applications in the FINRA Entitlement Program and the sensitive data that these applications may contain. While FINRA encourages administrators to review user accounts periodically throughout the year, FINRA is launching an annual user accounts certification process to enhance this review process. During the fourth quarter of each year, SAAs in organizations with more than one user will be required to complete an online certification process to ensure that:

• User accounts are “active” – any accounts that no longer require access should be removed;
• Users have only those application privileges they need to perform current job responsibilities – privileges should be removed/added as needed to match job functions; and
• Only those users who require access to sensitive data (e.g., Criminal History Record Information (CHRI), Social Security or tax identification numbers, dates of birth) are given access to this type of data – access must be removed for users who do not require it.

In November 2011, SAAs in organizations with more than one user will receive an email notifying them that the 30-day certification period is underway. The email will include a link that will enable the SAAs to initiate the certification process. Organizations will also be able to begin the process by clicking on a User Accounts Certification link that will be visible on the Account Management home page on the start date of the certification period. If user accounts are not certified within the 30-day certification period, the capability to create, edit and clone accounts will be disabled for all Administrators within the firm and will remain disabled until the firm completes the certification process.

The Texas State Securities Board is sending out the following email:

“The Registration Division of the Texas State Securities Board is aware that your investment adviser firm may be required to switch from SEC registration to state registration as a result of The Dodd Frank Wall Street Reform and Consumer Protection Act of 2010.

We encourage you and your firm to consider switching to state-registration now to avoid the bottleneck of applications expected between January 1, 2012 and March 31, 2012.   Beginning Monday, November 7, 2011, you may amend the Form ADV Part 1.B on the IARD system to begin the registration process.”

Today began the annual registration renewal period. I have to say, the people at the IARD system are extremely helpful. Kudos to them.

Just a reminder that the annual registration renewal period begins on Monday, November 14th. Advisers must log on to their IARD account and obtain their firm’s Preliminary Renewal Statement. Fees must be paid by December 12th.

Always best to start the process early.

Per the June release by the SEC in footnote 18, the SEC has raised the floor of assets under management above which advisers must register with the SEC to $110 million. However, they are permitted to register at $100 million. It is the same buffer as the old $25 million (may register with the SEC) and $30 million (must register with the SEC).