SEC & State Compliance.

Compliance Requirements for Funds and Fund Managers: Expert Legal Guidance

Overview of Compliance for Fund Managers

As a fund manager, navigating the complex web of regulatory compliance is essential to the success of your fund. The legal landscape for funds and fund managers is governed by both federal and state securities laws, primarily enforced by the U.S. Securities and Exchange Commission (SEC). Ensuring full compliance with these regulations is not just about avoiding penalties—it’s also about protecting your investors and maintaining your reputation in the financial industry.

Our law firm specializes in providing tailored legal services to fund managers, guiding you through the intricate rules and regulations set by the SEC and state securities authorities. Whether you're managing a hedge fund, venture capital fund, private equity fund, or mutual fund, we offer strategic counsel to help you maintain regulatory compliance and minimize risk.

SEC Compliance for Fund Managers

The SEC imposes strict regulations on fund managers, particularly under the Investment Advisers Act of 1940 and the Securities Act of 1933. As your legal partner, we ensure that your fund meets these federal requirements, including:

1. Registration Requirements

  • Fund managers may be required to register with the SEC as investment advisers if they manage over $100 million in assets under management (AUM).

  • Our team helps you determine whether your fund requires SEC registration or qualifies for an exemption, and we assist in filing the necessary paperwork.

  • Many times private placements or certain funds do not need to register with the SEC. In those cases we assist you in choosing the best exemption (like Regulation D or Regulation A) in order for you to create your fund and begin raising money.

2. Disclosure Obligations

  • Compliance with Form ADV filing is mandatory for registered advisers, which includes disclosing key information about your fund’s business practices, fees, and any potential conflicts of interest.

  • We provide comprehensive support in preparing and maintaining accurate, timely disclosures, ensuring that your filings are in line with SEC guidelines.

3. Custody Rule Compliance

  • The SEC’s Custody Rule (Rule 206(4)-2 under the Investment Advisers Act) imposes obligations on advisers who have custody of client funds or securities, such as independent audits and client notification.

  • We assist fund managers in developing procedures to meet these requirements and advise on audits by independent public accountants to ensure compliance.

4. Anti-Fraud Provisions

  • The SEC enforces a broad range of anti-fraud rules, including Rule 10b-5 under the Securities Exchange Act of 1934, which prohibits fraudulent or misleading practices in the management of funds.

  • Our attorneys help fund managers structure their operations to comply with anti-fraud provisions and avoid inadvertent violations.

5. Advertising and Marketing Rules

  • Fund managers must also comply with SEC guidelines on marketing materials, particularly when it comes to performance advertising, which must be fair and not misleading.

  • We provide guidance on creating marketing materials that comply with SEC rules, reducing the risk of enforcement actions.

State Securities Law Compliance

In addition to SEC oversight, fund managers must also comply with state-level securities regulations, commonly referred to as "Blue Sky Laws." These laws vary by state and impose additional registration, disclosure, and reporting requirements on funds and their managers.

1. State Registration Requirements

  • Fund managers may need to register with state securities authorities if their AUM is below the federal threshold for SEC registration or if their fund offers securities in a particular state.

  • We assist in determining whether state registration is necessary, and we help prepare and submit the required filings to state regulatory agencies.

2. Exemptions from State Registration

  • In some cases, fund managers may qualify for exemptions from state registration, such as under the National Securities Markets Improvement Act (NSMIA).

  • Our legal team analyzes your fund’s structure to identify potential exemptions, helping you avoid unnecessary regulatory burdens.

3. State-Specific Disclosure Requirements

  • Some states impose additional disclosure obligations on fund managers, including the submission of offering documents or annual reports.

  • We work closely with your team to ensure that your fund complies with state-specific disclosure rules, reducing the risk of enforcement actions by state regulators.

Ongoing Compliance Support for Fund Managers

Compliance is not a one-time task—it’s an ongoing process that requires regular attention and updating as regulations evolve. Our firm offers comprehensive, ongoing compliance support, ensuring your fund remains in good standing with both the SEC and state regulators.

1. Annual Compliance Reviews

  • We conduct thorough annual compliance reviews to ensure your fund continues to meet all regulatory requirements, including updates to Form ADV, investor communications, and operational procedures.

2. Compliance Program Development

  • Developing a robust internal compliance program is essential for minimizing risk. We work with fund managers to design and implement compliance programs that meet SEC standards, helping your organization maintain transparency and operational integrity.

3. Audit Preparation and Representation

  • Should your fund be subject to an SEC examination or audit, our attorneys provide representation and support throughout the process. We assist with document production, audit preparation, and communication with regulators to ensure the process runs smoothly.

Why Choose Our Law Firm?

With extensive experience in fund regulation and securities law, our attorneys are uniquely positioned to provide fund managers with the legal expertise they need to navigate the complexities of federal and state compliance. We offer:

  • Deep Regulatory Knowledge: Our team stays current on the latest regulatory changes, ensuring your fund remains compliant with all SEC and state requirements.

  • Personalized Legal Strategy: We work closely with fund managers to develop compliance strategies tailored to your specific needs, helping you avoid costly missteps.

  • Proactive Risk Management: By focusing on preventative measures and strategic planning, we help you identify and mitigate potential regulatory risks before they become problems.

Contact Us for Expert Legal Guidance

Don’t leave your fund’s compliance to chance. Whether you're a new fund manager or overseeing a well-established fund, our legal team is here to help you meet your compliance obligations with confidence. Contact us today or call 435 612-0422 to schedule a consultation and learn more about how we can support your fund's legal and regulatory needs.