Investment Advisers Act of 1940
U.S. federal statute that defines and regulates investment advisers, requiring registration with the SEC (or state equivalents) above prescribed AUM thresholds, imposing fiduciary duties, books-and-records requirements, custody rules, and the antifraud framework that governs hedge fund managers.
Details
- short name: Advisers Act
- aliases: IAA, 1940 Advisers Act
- jurisdiction: US
- regulator: SEC
- regulator url: https://www.sec.gov
- kind: act
- effective date: 1940-08-22
- summary: U.S. federal statute that defines and regulates investment advisers, requiring registration with the SEC (or state equivalents) above prescribed AUM thresholds, imposing fiduciary duties, books-and-records requirements, custody rules, and the antifraud framework that governs hedge fund managers.
- scope: Any person who, for compensation, advises others as to the value of securities or the advisability of investing in, purchasing, or selling securities.
- applies to: registered investment advisers, exempt reporting advisers, private fund managers
- related regulations: dodd-frank, investment-company-act-1940, securities-act-1933, exchange-act-1934
- related terms: registered-investment-adviser, form-adv, form-pf, fiduciary-duty, custody-rule
- official text url: https://www.sec.gov/about/laws/iaa40.pdf
- history: Enacted in response to the Investment Trust Study (1935-1939) following abuses uncovered after the 1929 crash. Significantly amended by Dodd-Frank (2010), which eliminated the 'private adviser' exemption that previously sheltered most hedge funds.