Investment Adviser Regulation: Rapid Fire

What this video covers

• The three-part ABC test for investment adviser status: advice about securities, in the business, and compensation (read broadly to include indirect economic benefits like referral fees)
• Why the late exclusion for lawyers, accountants, teachers, and engineers collapses when advice becomes more than solely incidental to the profession
• The bank exclusion trap: banks, savings institutions, and trust companies are out; their subsidiaries and affiliates are absolutely in
• AUM-driven registration hierarchy: mandatory SEC at $110 million and up, state registration at $25 million to under $100 million, and the New York mandatory-SEC fallback because the state skips IA exams
• Form ADV structure: Part 1 administrative filing via IARD, Part 2A the client brochure (services, fees, conflicts), and Part 2B the brochure supplement for individual providers
• Effective date distinctions: state registration effective at noon on the 30th day after filing, SEC has 45 days to grant or institute denial proceedings (not automatic)
• Custody vs. discretion net worth floors: $35,000 for custody with audited balance sheet, $10,000 for discretion unaudited, and the fee-deduction exception that skips the $35,000 floor entirely