SEC sweep examination of custodial controls

SEC sweep examination of custodial controls
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On Friday February 13th, the SEC sent notice letters to certain investment advisers and broker-dealers announcing an examination of their custodial controls and related arrangements for safekeeping of their client assets. The letter was sent from the SEC's Office of Compliance, Inspections and Examinations (OCIE), and it appears that OCIE is coordinating the exams. The SEC staff is requesting general information for the period January 1, 2008 to January 31, 2009 (ADV II, organization chart, list of pending suits or complaints, adviser's financials), as well as specific policy, procedure and testing information focused on the adviser's "safeguards surrounding its custodial arrangements and its verification procedures that support the existence of client assets."