Change to Definition of Qualified Client
The Securities and Exchange Commission (âSECâ) recently announced an upcoming change to the definition of âqualified clientâ as defined in Rule 205-3 under the Investment Advisers Act of 1940 (âAdvisers Actâ) that will become effective August 15, 2016. This applies to any Registered Investment Adviser (âRIAâ or âInvestment Adviserâ) that earns performance based fees.
To provide some background, Section 205(a)(1) of the Advisers Act generally prohibits an investment adviser from entering into, extending, renewing, or performing any investment advisory contract that provides for performance Read More…