SEC requires advisers to provide more information about business
The headquarters of the U.S. Securities and Exchange Commission (SEC) are seen in Washington, July 6, 2009. REUTERS/Jim Bourg
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WASHINGTON (Reuters) - The top U.S. securities regulator said on Thursday it would require more information from investment advisers about their separately managed account businesses, as it continues to tighten oversight on the sector.
Under the new rules, advisers will have to provide additional information regarding separately managed account businesses, including data on their use of borrowings and derivatives, and about other aspects of their business, such as the use of social media, the SEC said.
They will also have to maintain additional records on how they calculate and distribute performance information to help regulators determine the truthfulness of their advertising.
"These amendments are an important step in a series of rulemakings to enhance the SEC's monitoring and regulation of the asset management industry," SEC Chair Mary Jo White said in a statement.
"Requiring investment advisers to report this additional information will provide investors and the commission with a better understanding of the risk profile of each adviser and the industry as a whole."
Investment advisers will have until October 2017 to comply with the new requirements.
Also on Thursday, the SEC said it had found that 13 advisory firms broke the law by spreading false claims made by an investment management firm about the performance of its flagship product.
Earlier this year, the SEC said it was scaling back its examinations of brokers in order to boost oversight of investment advisers, whose numbers registering with the SEC has ridden steadily. Also, Congress in 2010 gave the agency new powers to oversee hedge funds and private equity funds.
Then, in June, the SEC proposed a rule to ensure that investors are not harmed when asset managers fall on hard times or close up shop.
(Reporting by Lisa Lambert; Editing by Alan Crosby)
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