1.2.2.3.2. Investment Adviser Registration
Investment advisers whose assets under management exceed $110 million must register with the SEC.
In addition, the following additional advisers must also register with the SEC:
• Advisers to registered investment companies
• Advisers whose principal office and place of business is in a state that has not enacted an investment adviser statute
• Pension consultants, if they provide investment advice with respect to $200 million or more of plan assets
Applicants for registration must file Form ADV (“ADV” = Adviser). Once registered, an adviser must update the form at least once a year. Form ADV consists of two parts. Part 1 of Form ADV contains general information about the investment adviser, such as:
• Information about the ownership and nature of the practice, including the names of the principals involved
• Location of the main office
• Types of services offered
• Whether the adviser has custody of customer assets
• Location of books and records
• Any relevant regulatory/disciplinary history
Form ADV Part 2 requires an adviser to prepare a narrative “brochure” that includes information relevant to the customer, such as:
• Fees or fee structure for the services provided
• Types of advisory services offered
• Methods of analyzing investments (e.g., technical versus fundamental)
• Any disciplinary actions information
• Any conflicts of interest
• Educational and business background of management and key advisory personnel
It also