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DC’s Department of Insurance, Securities and Banking Announces Report on Largest Coordinated Event Between State, Federal Securities Regulators

Wednesday, May 22, 2013

The Department of Insurance, Securities and Banking announced a report that documents federal regulators transferring supervision of mid-sized investment advisers to state oversight as called for by the Dodd-Frank Wall Street Reform and Consumer Protection Act.

The North American Securities Administrators Association, of which DISB is a member, prepared the report.

“This report details the history of the investment-adviser switch and the accomplishments of the securities administrators’ association members and staff to ensure that the largest coordinated regulatory event between the states and the Securities and Exchange Commission was accomplished successfully,” said Heath Abshure, the association’s president and Arkansas securities commissioner.

The 15-page report is available on the NASAA website at www.nasaa.org.

The Dodd-Frank Act raised the threshold for assets under management of investment advisers from $25 million to $100 million for state regulators. The switch took place over nearly three years.

Nationally, oversight of more than 2,100 mid-sized investment-adviser firms was transferred from federal to state regulators.  In the District, five mid-sized investment-adviser firms were added to 21 licensees.  Assets under management at DC-based licensed investment adviser firms increased  from an estimated $152 million in 2010 to an estimated $500 million in 2012, primarily as a result of the switch.

“The switch is a good example of how state and federal securities regulators collaborate to provide investors with stronger oversight of investment advisers,” said Department of Insurance, Securities and Banking Commissioner William P. White. “We look forward to working with these news firms in a regulatory environment that supports their efforts to provide the most valuable and trustworthy advisory services to District investors.”