SEC Issues Guidance for Robo-Advisers

6 March 2017
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Key takeaways

  • The SEC Division of Investment Management issued guidance to robo-advisers on their compliance obligations under the Investment Advisers Act.
  • The Guidance focuses on three main areas: (1) disclosures relating to the advisory services, (2) suitability obligations and (3) compliance program requirements.
  • The discussion about all three areas considered the intersection of technology with the requirements under the Advisers Act, and the Guidance notes that the firms need to include in their programs protocols around the development, implementation and monitoring of their technologies/algorithms.