Investment Adviser Lawyer in New York City

An investment adviser lawyer will be able to help you in a broad range of services for investment advisers from the formation of the business to compliance with the day-to-day regulatory operations.

Investment adviser representatives have a broader definition under the New Regulations than the definition under the Advisers Act. Under the New Regulations, the investment adviser representatives include “any individual who represents a New York registered investment adviser, for compensation, that engages in the business of advising members of the public, either directly or through publications or writings within or from the State of New York, as to the value of securities or as to the advisability of investing in, purchasing, or selling or holding securities, or who, for compensation and as a part of a regular business issues or promulgates analyses or reports concerning securities to members of the public within or from the State of New York.” While the Advisers Act is limited to investment adviser representatives advising natural person clients, the New Regulations include investment adviser representatives advising juridical persons, such as corporations, partnerships, and LLCs.

What does an investment adviser lawyer do?

The investment adviser lawyer will help you with the following:

• Formation of your investment adviser firm (partnership, LLC, or corporation)
• Prepare and file Form ADV with accompanying narrative brochures and summaries to register your firm with the SEC and state security authorities
• Register investment adviser representatives with New York authorities
• Draft contracts and policies that the company will need in its day to day business operations, such as privacy policy, anti-money laundering procedures, investment management agreements, and disclosure documents
• Prepare and file annual amendments to Form ADV to update the information filed
• Advise on advertising rules, separate account arrangements, and other best practices
• Represent investment advisers and their representatives on regulatory inquiries and discovery requests
• Represent clients in litigation and arbitration
• Assist the client in registering the offering of private funds by preparation private placement memoranda, subscription agreement, and other related materials

SEC’s role

Because investment advisers handle client’s wealth, investment advisers are subject to strict, thorough, and demanding regulatory compliances. When investment advisers experience substantial asset growth, they are subjected to a substantial increase in regulation. The SEC implements several regulations that ensure market integrity and investor protection, such as directing compliance with annual reports filing, annual audit, and providing rules for custody of client assets and withdrawal of funds or securities on the client’s behalf. Failure to observe these regulations can subject the investment advisers and its representatives to civil and criminal lawsuits on the federal and state level. An investment adviser representative can help guide you through the complex processes of investment advising that can ensure you are compliant and free from stiff and harsh penalties.

State Versus Federal Registration

Investment advisers must register either with the U.S. Securities and Exchange Commission or with one or more state securities regulators, depending on their assets under management and business model. Generally, advisers with $110 million or more in regulatory assets under management must register with the SEC. Advisers between $25 million and $100 million typically register with one or more states. Smaller advisers and certain specialized types of advisers may have other options. Choosing the right regulator is the threshold question for every new investment adviser business, and many advisers benefit from working through "switch" filings as their assets cross the SEC threshold up or down.

Form ADV and the Brochure

Form ADV is the central registration document for investment advisers. Part 1 contains structured information about the firm's business, ownership, regulatory history, and key personnel. Part 2A is the "brochure" — a plain-English narrative description of the firm's services, fees, conflicts of interest, and disciplinary history that must be delivered to all clients. Part 2B is a supplement covering each adviser representative who provides advice to a specific client. Part 3 (Form CRS, the "client relationship summary") is a two-page document for retail clients with prescribed format and content. Each part has its own preparation challenges. We draft and update these documents to reflect the adviser's actual business and to satisfy the regulators' detailed requirements.

The Fiduciary Duty

Investment advisers owe a fiduciary duty to their clients. This is a higher standard than the suitability standard that historically governed broker-dealers (and which under the SEC's Regulation Best Interest now requires care obligations closer to fiduciary for retail recommendations). The fiduciary duty includes a duty of care (to act with reasonable competence) and a duty of loyalty (to put client interests above the adviser's own). Conflicts of interest must be eliminated, mitigated, or fully disclosed and consented to. The fiduciary duty pervades the adviser's entire business — investment selection, fees, custody, brokerage, marketing, and dispute resolution.

The Marketing Rule

The SEC's Marketing Rule (Rule 206(4)-1 under the Investment Advisers Act), effective in 2022, fundamentally changed advertising and solicitation by investment advisers. The Rule now permits testimonials, endorsements, and third-party ratings subject to specific disclosure and conflict-of-interest requirements. Performance presentations must include net-of-fee performance, must be calculated consistently, and must include prescribed time periods. Hypothetical performance carries additional constraints. The Rule has produced a wave of enforcement actions against advisers whose websites, marketing materials, and social media posts did not satisfy the new requirements. We help advisers update their materials to comply.

Custody Rule

Advisers with custody of client assets face heightened obligations under Rule 206(4)-2. Constructive custody arises in surprising places — for example, when an adviser has a check-writing authority or can withdraw fees directly from a client's account. Compliance requires using a qualified custodian, providing notice to clients of the custodian's identity, complying with surprise examination requirements (with limited exceptions), and properly handling client funds and securities. The SEC has proposed significant amendments to the custody rule that would broaden its scope; we monitor those developments and help clients prepare for the changes.

Compliance Programs

Rule 206(4)-7 requires investment advisers to adopt and implement written policies and procedures designed to prevent violations of the federal securities laws, to review those policies annually, and to designate a chief compliance officer. The annual review must be documented and produce changes when needed. The "compliance manual" should be a living document, reflecting the firm's actual practices and updated as those practices evolve. Boilerplate manuals copied from other firms are a frequent SEC examination finding.

SEC Examinations

Investment advisers are subject to periodic examination by the SEC's Division of Examinations (formerly OCIE). Examinations can be routine ("never-before-examined" sweeps or scheduled cycle exams), focused on specific risks identified in a recent SEC alert, or "for cause" if a complaint or other event has prompted scrutiny. Exam outcomes range from no finding to deficiency letters to enforcement referrals. Being prepared for an examination — through ongoing testing, mock exams, and document organization — makes the difference between a routine experience and a disruptive one.

Private Funds and Pooled Vehicles

Many investment advisers manage pooled investment vehicles such as hedge funds, private equity funds, venture capital funds, and real estate funds. These funds raise capital from accredited investors and qualified purchasers in private placements exempt from registration under Regulation D. The private placement documents include the private placement memorandum (PPM), the limited partnership agreement (LPA) or operating agreement, the subscription agreement, the side letters, and the management agreement. Each document has standard provisions that are heavily negotiated by sophisticated investors. The 2023 Private Fund Adviser Rule made significant changes to disclosure and operational requirements for private fund advisers — many of which were vacated by the Fifth Circuit in 2024 but which continue to influence industry practice.

Enforcement Actions

Common SEC enforcement themes against investment advisers include misleading marketing, undisclosed conflicts of interest, breach of fiduciary duty, custody rule failures, compliance program deficiencies, and outright fraud. Penalties can include disgorgement, civil penalties, censure, bars, and registration revocation. The collateral consequences are often severe: a sanctioned adviser may lose its right to rely on certain exemptions, lose its ability to manage ERISA plan assets, or trigger disclosure obligations to existing clients and counterparties. We defend advisers in enforcement actions and negotiate resolutions where they are appropriate.

State-Level Requirements

State-registered advisers face their own layer of rules. New York's Martin Act gives the New York Attorney General broad authority over securities fraud. The New York Department of State administers state-level adviser registration through the IARD system. New York also requires that investment adviser representatives pass certain qualifying examinations (Series 65 or Series 66) unless they qualify for a waiver based on professional credentials. We help advisers navigate the parallel state registration and compliance requirements alongside their federal obligations.

Investment Adviser Litigation

When clients sue investment advisers, the disputes typically arise from underperformance, allegedly unsuitable investments, undisclosed fees, suspected fraud, or disputes over advisory agreement terms. Many advisers' contracts require arbitration through FINRA or another forum. Others permit court litigation. Either way, defense of these claims requires careful attention to the advisory agreement, the supporting compliance documentation, and the relevant fiduciary duty standards. We defend advisers in arbitration and litigation and we represent investors with legitimate grievances against their advisers.

Call Our Office

Should you need assistance, we, at the Law Offices of Albert Goodwin, are here for you. We have offices in New York City, Brooklyn, NY and Queens, NY. You can call us at 212-233-1233 or send us an email at [email protected].