The SEC proposed a rule that would require registered investment
advisers to adopt and implement written business continuity and
transition plans, in order to ensure advisers have plans to address
operational and other risks related to a significant disruption in
operations and minimize potential client and investor harm. The
proposed rule would require a plan be formulated to address the
particular risks associated with the adviser's operations and
include policies and procedures relating to: maintenance of systems
and protection of data; pre-arranged alternative physical
locations; communication plans; review of third-party service
providers; and plan of transition in the event the adviser is
winding down or unable to continue providing advisory services. It
would also require advisers to review the adequacy and
effectiveness of their plans at least annually and to retain
certain related records.
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