Internet Investment Advisors Now Required to Register with the SEC

The Securities and Exchange Commission (SEC) has amended existing rules to require internet investment advisers to register with the Commission.

According to the SEC’s Fact Sheet, the amendments will:

  • Require an adviser that relies upon the internet adviser exemption to provide
    investment advice to all of its clients exclusively through an “operational” interactive
    website at all times during which it relies on the exemption;
  • Eliminate the de minimis exception in the current rule, which permitted advisers
    relying on the internet adviser exemption to have a limited number (i.e., fewer than
    15) of non-internet clients in the preceding 12-month period; and
  • Amend Form ADV to require an adviser relying on the internet adviser exemption as
    a basis for registration to represent on Schedule D of its Form ADV that, among other
    things, it has an operational interactive website.

SEC Chairman Gary Gensler described the changes as modernizing a 22-year-old rule which will better protect investors.

“These changes better reflect what it means in 2024 truly to provide an exclusively internet-based service. This will better align registration requirements with modern technology and help the Commission in the efficient and effective oversight of registered investment advisers.”

The rule change will go into effect 90 days after publication in the Federal Register.


Sponsored Links by DQ Promote



Send this to a friend