Practice/Industry Group Overview
Investment advisers play a central role in the financial services industry. Sutherland provides comprehensive guidance to this growing sector.
As the financial services industry as a whole has been subject to an evolving regulatory environment, investment advisers in particular have recently become the focus of increased regulatory reporting and government oversight. Sutherland counsels clients across this vital business, advising large registered investment advisers (RIA) with billions under management as well as the smallest, independent unregistered adviser just launching its business. Our experienced attorneys provide comprehensive counseling for investment advisers, beginning with entity formation, registration and disclosure matters and extending to preparing investment advisory contracts, advising on compensation arrangements, developing comprehensive compliance programs and advising on permitted activities by affiliated fund sponsors, broker-dealers and registered reps. We help gauge legal exposure through risk management audits and provide critical assistance when problems arise, guiding clients through enforcement exams, proceedings, litigation and arbitration.
Financial planning, wrap fee programs and unified managed accounts are common advisory services provided in the high net worth or retail and retirement markets. We counsel clients regularly on issues relating to these programs, including risks associated with the use of programs developed by vendors and third party service providers. We are as comfortable in this segment of the industry as we are with clients whose focus is more institutional.
We believe in prevention whenever possible, and have pioneered a practical approach for written procedures that compliance officers have enthusiastically embraced. We are well versed in the rules and standards that apply to adviser marketing material and work closely with a number of clients in devising new marketing concepts. Our proactive service helps ensure that many potential problems are avoided altogether.
Registration track record. We have helped numerous clients become registered as investment advisers with the SEC. We have hands-on experience in drafting the requisite application materials and other items to establish an investment adviser.
Advocacy. We’re involved with the development of new regulations. For example, when the SEC re-proposed an overhaul of Form ADV, Part 2, we formed a working group to advocate changes, submitted a detailed comment letter to the SEC about the proposal and participated in industry conferences with regulators about the proposal. Our efforts contributed to the SEC’s decision to delay adoption.
Experience with dually registered firms. Sutherland counsels some of the nation’s largest dually registered broker-dealers/investment advisers, with clients spanning the full spectrum of distribution channels. We provide comprehensive and seamless legal solutions to companies facing the complex interplay between investment adviser and broker-dealer (and often banking and insurance) regulation.
We understand SMA/UMA/Fund Programs. Sutherland has one of the leading Separately Managed Account (SMA) legal practices. Our practice covers an array of products and participants in these programs. We advise portfolio managers, sponsors and investment advisers, including SMAs, mutual fund accounts and unified managed account.
Broad support. Sutherland’s Investment Adviser practice is part of a comprehensive, nationally recognized Financial Services Practice Group that offers proficiency and experience across a broad spectrum of the financial services industry. Sutherland’s attorneys handling investment adviser matters frequently collaborate with colleagues in other Sutherland practice groups to ensure that clients receive timely, efficient and cost-effective advice.
Nuts and Bolts
Our clients include:
- Stand-alone advisers
- Advisers within or affiliated with a financial services firm
- Advisers of unaffiliated funds
Sutherland regularly represents investment advisers in connection with:
- Formation, registration and disclosure
- Day-to-day operations
- Performance reporting and advertising
- Regulatory relief and advocacy
- Enforcement, investigations, inspections, examinations and litigation
- Mergers and acquisitions
We counsel clients on how to prepare for and benefit from regulatory and marketplace changes that impact their business strategies and operations, including:
- Platform construction and implementation
- Contracts between turnkey SMA sponsors and investment advisers/portfolio managers/model providers
- Single and dual contract arrangements
- Turnkey Asset Management Programs
- Overlay management
- Due diligence requirements
- Fee sharing and multiparty disclosure issues
- Rule 3a-4 (inadvertent investment company) issues
- Client reporting
- Proxy voting
Sutherland provides seamless legal advice and representation for every type of investment adviser. Our proactive approach keeps our clients a step ahead and helps shape future regulatory changes.
We regularly advise clients on distribution and platform arrangements.
Sutherland's attorneys offer guidance on multifaceted distribution and platform arrangements, including joint ventures between insurance companies and advisers regarding synthetic guarantees that wrap around separately managed or mutual fund accounts.
Sutherland's attorneys counsel on compliance with the Advisers Act.
We advise clients to maintain ongoing compliance with the requirements of the Investment Advisers Act of 1940, including the development of compliance policies and procedures, risk identification, mock SEC audits and internal appraisal of compliance systems and the design of forensic testing. We also advise our clients in developing personnel training modules and live training sessions and implementing supervision systems, controls and practices.
Sutherland assists in investment adviser registration.
We have worked to register hundreds of firms as investment advisers with the SEC, drafting application materials and other items necessary to gain registered investment adviser status. We advise our clients on the optimal business structure and holding company organization, the formation of business entities, and the drafting and filing of forms, including the new Form PF related to private fund advisers.