SEC Brings First Marketing Rule Enforcement Action Under Atkins

In September, the Securities and Exchange Commission (SEC) brought its first Marketing Rule enforcement action against Meridian Financial, LLC, alleging that Meridian’s website contained statements that were inconsistent with its Form ADV filing, books and records violations, and broader compliance program failures. An Akin client alert notes “this matter suggests that the SEC remains willing to bring enforcement actions for clear violations of more technical provisions of the Advisers Act that do not necessarily involve fraud or investor harm.” Akin further emphasizes that annual compliance reviews must be “meaningful.” While this case focuses on violations of the Advisers Act, fund directors also have obligations related to compliance reviews. According to Akin, investment funds may want ensure “annual reviews include a meaningful assessment of the particularized compliance risks” and “document their annual reviews in a manner that will allow them to demonstrate that they are both substantive and complete in the event of an SEC exam.”  

Click here to read a client alert from Akin Gump Strauss Hauer & Feld LLP.