Previously on our blog we discussed situations where advisers are deemed to have custody, Assessing Custody for Registered Investment Advisers. If your firm has deemed itself to have custody, you need to ensure your firm is compliant with the Custody Rule requirements. If this is the case, consider the following:
If you are a private fund adviser (i.e. hedge fund or pooled investment vehicle), do you know if you are deemed to have custody? If so, is your Form ADV Part I completed correctly? Custody for private fund advisers is regarded by the SEC as an extremely important topic and should be reviewed frequently by your firm.
Since there is a significant increase in compliance responsibilities for firms that have custody of client funds and/or securities, it’s critical that you consider whether or not your firm will be deemed to have custody.