In an article published in The Investment Lawyer, Partner Gretchen Passe Roinoutlines a proactive approach for investment advisers to disclose conflicts of interest under the Investment Advisers Act of 1940. By embracing transparency and direct engagement, advisers can better meet strict regulatory standards and earn informed client consent in today's complex environment.
Excerpt: "Offensive disclosure leans towards obvious exhibition and expression in public. It invites engagement, for the purpose of obtaining from clients (and demonstrating to regulators) informed consent. In contrast, playing defense means 'playing small.' Defensive disclosure is subtle or generic, avoiding the attention of regulators or clients. Adopting an offensive disclosure strategy is a logical response to the current regulatory environment. The standards for disclosing conflicts of interest have become increasingly formulaic and rigidly applied. The volume and complexity of economic interests that create the conflicts have never been greater. And scrutiny continues to grow for advisers that lean on disclosure to obtain informed consent, rather than eliminate or mitigate their conflicts of interest."
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
[View Source]