June 15, 1989
TO: INVESTMENT ADVISERS COMMITTEE NO. 23-89
RE: INSTITUTE COMMENTS ON PROPOSED ILLINOIS INVESTMENT
ADVISER RULES
__________________________________________________________
On June 13, 1989, the Institute submitted the attached
letter to the Illinois Securities Department concerning proposed
Illinois investment adviser rules. A copy of the proposed rules
is also attached.
In our letter, we made a number of comments concerning both
substantive and technical problems associated with the proposed
rules. Our comments included recommendations that the following
changes be made: (i) the balance sheet proposed rule requirement
should be modified so that it is coordinated and consistent with
the requirement found in Question 14 of Part II of Form ADV; (ii)
the requirement that an investment adviser send copies of their
articles of incorporation, bylaws or partnership agreements to
the securities department should be deleted; (iii) the
requirement that an investment adviser send a form to the
securities department attesting to negotiable fees and
discretionary authority should be deleted because the information
is already contained in the adviser's Form ADV; (iv) the
requirement that an investment adviser display a certificate from
the securities department should be deleted because it would
create an imprimatur from the securities department; and (v) the
(existing rule) requirement that investment adviser principals
must take the General Securities Principal Examination (Series
24) should be deleted. With regard to this last comment, the
Illinois Securities Department would like information concerning
appropriate NASD examinations for principals of investment
advisory firms. Please contact the undersigned if you have any
thoughts on this.
We will keep you any informed of developments.
Robert L. Bunnen, Jr.
Assistant General Counsel
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