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SEC Proposes to Update Longstanding Investment Adviser Advertising and Solicitation Rules

Posted in Investment Adviser Regulation

The Securities and Exchange Commission (SEC) proposed amendments to both the advertising rule and the cash solicitation rule under the Investment Advisers Act of 1940 (the “Advisers Act”) on November 4, 2019. Neither rule — adopted in 1961 and 1979, respectively — has been amended significantly since it was adopted, although the SEC and its staff have, from time to time, granted no-action relief and otherwise interpreted the application of these rules. According to the SEC, the proposed amendments are intended to update such rules to reflect changes over the past half-century in “technology, the expectations of investors seeking advisory services, and the evolution of industry practices.”

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