(Article from Registered Funds Regulatory Update, April 2022)
For more information, please visit the Registered Funds Resource Center.
In his first address as Director of the SEC’s Division of Investment Management, William Birdthistle addressed what he sees as “financial fracture” in the “ecosystem of entities” that provide services to investment advisers and their clients. Such entities include “index providers, valuation services, model providers, risk managers, data analysts” as well as others. In his remarks, Birdthistle potentially calls for the registration of these entities, saying, “if these service providers are not registered with the SEC, then their performance of critical responsibilities for advisers may constitute an unwelcome disintegration of important protections that could result in harm to investors.”
Turning his attention to crypto, he stated that he is cognizant of questions about how providing advice regarding crypto assets impacts compliance with the custody requirements under the Advisers Act. In light of this, Birdthistle noted that he is examining ways “to bring order” to crypto assets and the growing use of digital technology.
William Birdthistle, SEC Director of Division of Investment Management, Speech, Remarks at the IAA Investment Adviser Compliance Conference (Mar. 3, 2022), available at: https://www.sec.gov/news/speech/birdthistle-remarks-iaa-investment-adviser-compliance-conference-030322.