Be aware of your weaknesses and deficiencies

The latest risk alert published by SEC points out the compliance issues highlighted by OCIE (Office of Compliance Inspections and Examinations) with regards to the Compliance Rule (206(4)-7) under the Investment Advisers Act of 1940. Below is a summary of the key notable deficiencies.

  • Inadequate compliance resources: Staff of the Office of Compliance Inspections and Examinations (OCIE) observed advisers that did not devote adequate resources, such as information technology, staff, and training, to their compliance programmes. For example, advisers that had grown significantly in size or complexity but had not hired additional compliance staff or added adequate information technology, leading to failures in implementing or tailoring their compliance policies and procedures.


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About the Author

Manish Mohan Raj is the delivery manager in Forensic Compliance team and subject matter expert for the forensic compliance practice. He has over 8 years of experience in the financial services industry. Prior to joining Acuity Knowledge Partners he worked as an associate with Goldman Sachs — GSAM Compliance. He was part of the global forensics team and was part of the marketing and portfolio management compliance team. Manish was also part of the controls management team for the asset & wealth management team at JP Morgan and was part of the HSBC KYC remediation team for multiple lines of business.

We write about financial industry trends, the impact of regulatory changes and opinions on industry inflection points.