When does the new AUM threshold for investment
advisers become effective?
The provision in the Dodd-Frank legislation
raising the threshold for SEC licensing for investment advisers
to $100 million becomes effective July 21, 2011.
Subject to certain exceptions, mid-sized
investment firms with $25 million to $100 million in total
assets under management will be prohibited from registering
with the SEC and therefore must register as a state registered
investment advisor (the Switch.)
Has a timeline been published for switch?
Yes. Investment advisory firms required to
make the Switch may withdraw their registration with the SEC
as early as January 1, 2012, but must have withdrawn their
SEC registration by June 28, 2012. Prior to withdrawal of
their SEC registration, investment advisory firms must have
registered as a state investment advisor.
How does a transitioning investment adviser
assure it is continuously registered at the appropriate regulatory
Apply for and receive Oregon approval prior
to filing the ADV-W with the SEC.
Can a state registered investment adviser
register in more than one state using IARD?
Yes. All states use Form ADV. Please check
our website for Oregonís document requirements and each state
for their respective requirements.
When must a state registered investment
adviser (RIA) license the firm and investment advisor representatives
(IARs) in Oregon? Does Oregon have a de minimus rule?
A state investment adviser firm located
outside Oregon must license in Oregon when it has more than
5 clients in Oregon. The firm must also license at least one
representative. An investment advisor firm with a physical
location in Oregon must license the firm and all representatives
located in Oregon. There is no de minimus rule for Oregon-based
RIAs and IARs. Any IAR located in Oregon must be licensed
Will we have to file U4 amendments for
my investment adviser representative(s) (IARs)?
No. Because the firm's IARD number associated
with the investment adviser representative does not change,
there should be no effect on the existing U4 filing. However,
some investment adviser representatives currently exempt from
licensing may need to be licensed. Please call us to discuss
your firm's situation if you have any questions on this.
What documents are required to license
as an Oregon investment adviser?
The following documents must be filed via
the IARD system:
- Form ADV, Part 1A and all applicable
- Form ADV Part 1B
- Form ADV Part 2A and Part 2B
- Form U4 for all individuals providing
investment advisory services
The following documents must be forwarded
to the Oregon Division of Finance and Corporate Securities:
- Copies of investment advisory agreements,
financial planning agreements, and solicitor's agreements.
- Financial Statements. Investment advisers with custody
of client funds/securities must provide independently audited financial
statements by a CPA or Public Accountant. See OAR 441-175-0100.
- An original Surety Bond or Letter of Credit
in the amount of $10,000.
- Evidence of compliance with either the
Gramm-Leach Bliley Act (GLBA) / FTC guidelines, or the Oregon
Identity Theft Protection Act.
- Additional documents may be requested
by the Division licensing examiners in the course of application
Does Oregon have a minimum net worth requirement
for state investment advisers?
Oregon does not have a specific minimum net
worth requirement. The investment advisor must be solvent
at all times pursuant to ORS
What Oregon statutes and administrative
rules should I become familiar with in preparation for my
Statutes and rules that apply to licensing
as an Oregon investment advisor include, but are not limited
to the following (a complete list of our rules and statutes
may be found by clicking
Oregon Revised Statutes
59.015 - Definition of an investment adviser
59.165 - Licensing
59.235 - General Supervision - Powers of Director
59.315 - Subpoena Powers
Oregon Administrative Rules
441-175-0041 - Exclusion - Per Capita Referral
441-175-0070 - Licensing Rules - General
441-175-0100 - Licensing IA - IARD
441-175-0105 - Material Changes
441-175-0120 - Licensing Reps
441-175-0165 - Renewals
441-175-0040 - Books and Records to be Maintained
441-195-0050 - Reports by Investment Advisers
441-195-0060 - Complaints
441-205-0145 - Fiduciary Duty
441-205-0165 - Brochure Rule
441-205-0170 - Share of Capital Gains
441-205-0180 - Custody of Funds
441-205-0200 - Advertising
Do Oregon's rules for investment advisers
differ substantially from the SEC's?
Generally, rule differences may be found
in the areas of custody of funds, best execution, Anti-Money
Laundering (AML) policy, code of ethics, minimum net worth,
annual amendments, and identity theft.
What differences can I expect as an Oregon
One difference may be the examination cycle.
Oregon maintains a three-year routine examination cycle of
investment adviser firms.
Has Oregon adopted the new ADV Part 2
Brochure distribution schedule as described in the instructions
and guidance section of Part 2 of Form ADV?
Oregonís brochure rule requires an annual
offer of ADV Part 2. It does not include the distribution
of material changes on a scheduled basis as described in the
guidance section of Part 2 of Form ADV.