Investment Adviser Representative Supervision

What this video covers

• Why written compliance policies are necessary but not sufficient, and what "adopt and implement" actually means on the exam
• The three requirements for a Chief Compliance Officer (CCO): competent and knowledgeable, sufficiently senior to enforce policies, and identified on Form ADV Part 1
• Why the CCO does not need to be an outside consultant, hold a specific license, or have a minimum number of years of experience
• Why the annual compliance review must be documented in writing, and why oral presentations fail the requirement
• How monitoring personal securities transactions catches conflicts outside client files, including front-running and scalping
• The distinction between front-running (trading before a known client order to capture price movement) and scalping (creating artificial demand through recommendations to inflate a personal position's value)
• Why "I didn't know" is never a defense for failure to supervise, and the two-part test for reasonable supervision (written procedures plus active enforcement)