Les Abromovitz

About the Author

Les Abromovitz

Les Abromovitz is the author of The Investment Advisor’s Compliance Guide, published for 2012 by The National Underwriter Company/Summit Business Media. Les Abromovitz is an attorney and member of the Pennsylvania bar. Les has handled hundreds of consulting and publishing project for a leading compliance and regulatory services firm. He has conducted a number of seminars and training sessions dealing with compliance subjects. Les is also the author of several White Papers that analyze compliance issues impacting Registered Investment Advisors (RIAs).

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  Don’t Fall Off a Compliance Cliff in 2013

  By Les Abromovitz  |  January 21, 2013

  The U.S. avoided one fiscal cliff, but without proper books and records, state- and SEC-registered investment advisors can teeter on a cliff of their own making. One advisory firm's cautionary tale.

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  Advertising Advisor Services and Credentials

  By Les Abromovitz  |  January 1, 2012

  Section 206 of the Investment Advisers Act contains the anti-fraud provision of the statute and ensures that RIAs’ advertising and marketing practices are consistent with the fiduciary duty owed to clients and prospective clients.   

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  Agency and Principal Transactions

  By Les Abromovitz  |  January 1, 2012

  In passing Section 206(3) of the Investment Advisers Act, Congress recognized that principal and agency transactions can be harmful to clients. Such transactions create the opportunity for RIAs to engage in self-dealing.

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  Anti-Fraud Provisions of the Investment Advisers Act

  By Les Abromovitz  |  January 1, 2012

  RIAs and IARs should view themselves as fiduciaries at all times, whether they meet the legal definition or not.  Deviating from the fiduciary standard of full disclosure while courting clients may cause the advisor significant problems.

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  Best Practices for Working with Senior Investors

  By Les Abromovitz  |  January 1, 2012

  Securities examiners deal harshly with RIAs that do not fulfill their fiduciary obligations toward senior investors, as the SEC and state securities regulators view older investors as particularly vulnerable and in need of protection.

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  Books and Records Rule

  By Les Abromovitz  |  January 1, 2012

  Thorough and complete books and records enable RIAs to demonstrate that they have fulfilled their fiduciary obligations to clients and complied with applicable rules and regulations.

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  Client Commission Practices and Soft Dollars

  By Les Abromovitz  |  January 1, 2012

  RIAs should always evaluate whether the products and services they receive from broker-dealers are appropriate. The SEC suggested that an RIA’s failure to stay within the scope of the Section 28(e) safe harbor may violate the advisor’s fiduciary duty to clients, so RIAs must evaluate their soft dollar relationships on a regular basis to ensure they are disclosed properly and that they do not negatively impact the best execution of clients’ transactions.

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  Client Communication and Miscommunication

  By Les Abromovitz  |  January 1, 2012

  RIA policies and procedures must specify what type of communications should be retained. The safest course of action is for RIAs to retain all communications—to clients, from clients, and about client accounts.  To comply with fiduciary obligations, communications must be thorough and not mislead.

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  Code of Ethics Rule

  By Les Abromovitz  |  January 1, 2012

  The Code of Ethics Rule, found in Rule 204A-1, uses severe consequences for violation to help ensure investment advisors will do the right thing.  

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  Conducting Due Diligence of Sub-Advisors and Third-Party Advisors

  By Les Abromovitz  |  January 1, 2012

  Engaging in due-diligence of sub-advisors isn’t just a recommended best practice— it is part of the fiduciary obligation to a client. An RIA should be extremely reluctant to enter a relationship with a sub-advisor who claims the firm’s strategy is proprietary.