On February 23, 2017 the Staff of the SEC’s Division of Investment Management released “suggestions” on how robo-advisers meet their obligations under the Investment Advisers Act of 1940 (“Advisers Act”). The Staff noted that their guidance was intended for robo-advisers that “provide services directly to clients over the internet” but noted that the guidance could be useful to other types of robo-advisers.
The Staff categorized its guidance into the following three areas:
- Disclosures to clients;
- Information required to provide suitable advice;
- Effective compliance program designed to address automated advice.
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