On June 22, 2011, the SEC approved an exclusion for “family offices” from the regulations of the Investment Adviser Act of 1940. The new exemption applies to a company that only provides advice to “family clients,” is wholly owned by “family clients,” and does not hold itself out to the public as an investment adviser. “Family clients” include family members, key employees, and certain other clients.
Family offices were typically covered under the exemption for advisers with fewer than 15 clients, but that exemption will be removed under Dodd-Frank changes.
Relevant to the Series 7, 6, 65, 66, 63, 24 and Series 26 exams.
Source: SEC Release 2011-134