January 27, 1994
TO: INVESTMENT ADVISERS COMMITTEE NO. 5-94
VERMONT INVESTMENT ADVISER ASSOCIATE MEMBERS
RE: INVESTMENT ADVISER LEGISLATION INTRODUCED IN VERMONT
__________________________________________________________
Legislation was recently introduced in Vermont to provide for the
registration and regulation of investment advisers and investment adviser
representatives. In addition, House Bill 617, would amend the Vermont Securities
Act in a manner generally consistent with the NASAA Model Amendments to the
Uniform Securities Act relating to investment advisers to:
-- Require an investment adviser to register each branch office
located in Vermont at an annual fee of $100;
-- Permit the Vermont Commissioner of Securities (the
"Commissioner") to require the dissemination of information as
necessary for the protection of investors. The Commissioner
may permit information furnished to clients pursuant to the
Investment Advisers Act of 1940 and the rules thereunder to
satisfy this requirement in whole or in part;
-- Prohibit an investment adviser from entering into a contract
unless it provides in writing the compensation arrangement
between the adviser and the client and the nature of the
services to be provided by the client to the adviser;
-- Prohibit the use of any advertising material until such
materials have been filed with and approved by the
Commissioner;
-- Require investment advisers to maintain a bond in a n
amount
to be
set by
t h e
Commis
sioner
not to
exceed
$25,00
0;
-- Prohibit an investment adviser representative from being
registered with more than one investment adviser at a time;
-- Require investment advisers to file certified financial
statements when requested by the Commissioner; and
-- Require the maintenance of records prescribed by the
Commissioner for a period of six years unless another period
is prescribed by the Commissioner.
The bill also permits the Commissioner to promulgate rules establishing
examination and minimum financial requirements for investment advisers. Civil
and administrative remedies are provided for violation of the provisions of the
bill or any rules promulgated thereunder.
A copy of House Bill 617 is attached. If you have any comments on the
bill, please call the undersigned at 202/326-5825.
Tamara K. Cain
Assistant Counsel
Attachment