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Investment Advisers and the Custody Rule: New SEC Guidance and Actions to Take Now

Standing Letters of Authorization, Imputed Custody, and Disclosure Requirements

Recording of a 90-minute premium CLE webinar with Q&A

This program is included with the Strafford CLE Pass. Click for more information.
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Conducted on Tuesday, October 24, 2017

Recorded event now available

or call 1-800-926-7926

This CLE course will examine the Custody Rule as currently interpreted and enforced under the Investment Company Act of 1940 (the Act). The panel will discuss recent SEC guidance on imputed custody and standing letters of authorization, disclosure requirements, and best practices for investment advisers.


The SEC’s Custody Rule imposes detailed requirements governing how an SEC-registered investment adviser must hold client assets and related obligations. For purposes of the Act, custody turns on the adviser's authority to control the disposition of client assets rather than physical custody.

In Feb. 2017, the SEC issued guidance cautioning investment advisers that common provisions in custody agreements may impute custody of client funds or securities, unless advisers take steps to avoid inadvertent custody.

The SEC also issued a no-action letter confirming that an investment adviser has custody of client assets if the adviser exercises limited authority under a standing letter of authorization (SLOA). Even if an adviser follows the requirements in the no-action letter, the adviser must include client assets on Form ADV after Oct. 1, 2017.

Listen as our authoritative panel analyzes the Custody Rule and how it is impacted by recent SEC guidance. The panel will discuss best practices for documenting client relationships and engaging in advisory activities which comply with (or avoid) the Custody Rule.



  1. The Custody Rule post-Madoff
  2. Disclosure, recordkeeping and other requirements under the Custody Rule
  3. 2017 guidance regarding imputed custody
  4. 2017 no-action letter regarding SLOAs
  5. Best practices for avoiding the Custody Rule
    1. Amendments to existing agreements
    2. Revisions to forms
  6. Actions to mitigate against enforcement actions under the Custody Rule


The panel will review these and other key issues:

  • What are the common areas of misunderstanding with regard to the Custody Rule?
  • When might an investment adviser be deemed to have imputed custody of client assets?
  • What actions should investment advisers be advised to take in light of the SEC no-action letter regarding SLOAs?
  • How might recent SEC guidance affect investment adviser disclosures going forward?


Laurenson, Edwin
Edwin C. (Ted) Laurenson

McDermott Will & Emery

Mr. Laurenson focuses his practice on investment management matters, including private investment funds,...  |  Read More

Rockas, Anastasia
Anastasia T. Rockas

Skadden Arps Slate Meagher & Flom

Ms. Rockas focuses her practice on private investment funds and private equity investments. Her private investment fund...  |  Read More

Scanlan, Kevin
Kevin P. Scanlan

Kramer Levin Naftalis & Frankel

Mr. Scanlan advises clients on structuring, forming and investing in international and domestic private investment...  |  Read More

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