January 21, 2021

Blog | MasterCompliance

  • Brochure Delivery Requirements
    Part 2A of the Form ADV requires advisers to create narrative brochures containing information about the advisory firm. Both federal and state registered advisers must prepare and deliver a brochure to their clients according to the brochure delivery requirements set in 17 CFR § 275.204-3 – Delivery of brochures and brochure supplements. Delivery Requirements for SEC Registered Advisers A firm brochure must be delivered to each client before or at the time an advisory agreement is entered into with a client, and it must be delivered even if the advisory agreement with the client is oral. Thereafter, each year, within Read More....
  • Part 2A of Form ADV: Firm Brochure
    Rule 204-3, the brochure rule, is a requirement under the Investment Advisers Act of 1940 that requires investment advisers to provide a written disclosure statement to their clients. The rule applies to all federally registered investment advisers and specifies times during the advisory process at which they must provide the materials. To satisfy this rule, adviser can either provide clients Part 2 of the Form ADV, or they can provide an actual brochure that contains the same information that would be found in Form ADV Part 2A and 2B. Part 2 of the Form ADV consists of: Form ADV Part Read More....
  • 5 W’s of the SAR Narrative
    The Financial Crimes Enforcement Network (“FinCEN”) requires certain financial institutions to file Suspicious Activities Reports (“SARs”) in order to enable law enforcement to initiate or supplement major money laundering or terrorist financing investigations and other criminal cases. Financial institutions use the SAR to document and report suspicious or potentially suspicious activity among their clients. The report has a narrative format, requiring financial institutions to document all suspicious activity concisely and in chronological order. In general, a SAR narrative should identify the five essential elements of information – who?  what? when? where? and why? Who is conducting the suspicious activity?   To Read More....
  • Form ADV
    Form ADV is the uniform form used by investment advisers that manage at least $25 million in assets to register with both the SEC and state securities authorities. The Form ADV is divided into 3 parts. Part 1 is a fill-in-the blank form that contains information about the investment advisory business and how it operates. Part 2 is a brochure in narrative form that include plain English disclosures of the adviser’s business practices, fees, conflicts of interest, and disciplinary information. The last part is Part 3, which contains the relationship summary, which investment advisers are required to deliver to retail Read More....
  • Filing A Suspicious Activity Report ("SAR")
    The Financial Crimes Enforcement Network requires certain financial institutions to file a Suspicious Activities Reports (“SAR”) to report suspicious transactions, as detailed in their FinCEN SAR Electronic Filing Instructions. This blog will go over some of the important aspects of filing a Suspicious Activity Report. Who Must File? Certain financial intuitions operating in the United States will file their SARs with FinCEN. The financial institutions required to file SARS with FinCEN are as Follows: Banks, Financial Holding Companies, Casinos and Card Clubs, Money Services Businesses, Brokers or Dealers in Securities, Mutual Funds, Insurance Companies, Futures Commission Merchants and Introducing Brokers Read More....
  • Message Archiving
    An important component of financial compliance for broker-dealers is establishing message archiving for all communications relating to its business. Not only is it required by FINRA, but it can protect your Firm if there is an employee conducting unethical or illegal business activities. In a communication from Smarsh, a participant in FINRA’s Preferred Pricing Program, they state that “Broker-dealers can avoid being penalized by regulators for wrong doing among individual professionals if they can clearly demonstrate that they are proactively and sufficiently capturing and monitoring all electronic communications.” FINRA’s Archiving Requirements The FINRA message archiving requirements are designed to protect Read More....