Information Notice 6/6/11

FINRA Encourages Firms to Make Reasonable Efforts to Assist Investment Advisers Seeking Information Pursuant to Rule 206(4)-5 Under the Investment Advisers Act of 1940


Executive Summary

Rule 206(4)-5 under the Investment Advisers Act of 1940 (Advisers Act) curbs “pay-to-play” practices by prohibiting an investment adviser from providing advisory services for compensation to a government client for a period of time after the adviser makes a contribution to certain elected officials or candidates.

 

In some cases, it may be difficult for an investment adviser to identify government investors when shares in a covered investment company managed by the investment adviser are held through an intermediary. In these situations, FINRA encourages firms to make reasonable efforts to assist investment advisers seeking to comply with Rule 206(4)-5.

 

Questions regarding this Notice may be directed to Angela C. Goelzer, Vice President, Office of Investment Companies Regulation, at (202) 728-8120.