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Fundamentals of Investment Adviser Regulation 2016


Speaker(s): Ben Alden, Chris Stanley, Clifford E. Kirsch, G. Philip Rutledge, Heather L. Traeger, Kenneth J. Berman, Lorna A. Schnase, Maureen Baker Fialcowitz, Michael Hershaft, Peter M. Rosenblum, Steven A. Yadegari, Steven W. Stone, Theodore E. Eichenlaub, Vanessa A. Scott
Recorded on: Jul. 13, 2016
PLI Program #: 148942

Cliff Kirsch began his career at the U.S. Securities and Exchange Commission (SEC), became chief legal officer for one of the country’s largest dually- registered broker-dealer/advisers and then joined Sutherland (now Eversheds Sutherland) in 2006. He relies on his regulatory and in- house background and an up-to-date knowledge of regulatory developments to provide practical and innovative counsel to broker-dealers and investment advisers in the areas of securities regulation and compliance.

With more than 25 years of experience, Cliff regularly counsels clients on the design and distribution of investment products including wrap-fee programs and other advisory products, mutual funds, bank collective investment funds and insurance products. He also focuses on issues related to the design and implementation of compliance programs at financial services firms.

While at the SEC, Cliff received the Manuel F. Cohen Award, which recognizes younger lawyers who have displayed outstanding legal ability, integrity and judgment and he served as assistant director of the SEC's Division of Investment Management.

Cliff is a frequent speaker at industry conferences, and is the author and editor of two of the leading treatises in the broker-dealer and adviser arena: Broker-Dealer Regulation and Investment Adviser Regulation (published by the Practising Law Institute).

Cliff is also co-founder of the Julia Anne Kirsch Foundation, which seeks to serve the needs of disabled individuals and their families.

Experience

Eversheds Sutherland counsels a coalition of major life insurance companies on evolving state and federal regulations and other legal developments.

Eversheds Sutherland represents a coalition of major life insurance companies, which collectively account for more than 80% of the annuity business in the United States, in their efforts to affect the direction and details of various SEC, FINRA, CFTC, NAIC and state rule proposals and initiatives.

Eversheds Sutherland serves as outside counsel on broker-dealer and adviser regulatory issues for one of the largest independent broker-dealer networks in the country.  Eversheds Sutherland serves as regular primary outside counsel on broker-dealer and adviser regulatory issues for one of the largest independent broker-dealer networks in the country.

Eversheds Sutherland represents coalition of collective trust fund sponsors, advisers and other service providers.

Eversheds Sutherland serves as counsel to the Coalition of Collective Trust Funds. Among other things, Sutherland monitors and reports on legal and regulatory matters affecting collective trust funds.

Professional Activities

Member, New York City Bar Association

Faculty, FINRA Compliance Institute at The Wharton School of the University of Pennsylvania

Former Chair, FINRA Variable Products Committee

Former Board Member, National Society of Compliance Professionals


Heather L. Traeger serves as the Chief Compliance Officer and Compliance Counsel for the Teacher Retirement System of Texas. TRS is one of the largest public pension plans in the country at approximately $154 billion, and serves 1.6 million public education employees and retirees. TRS invests in most segments of the market either directly or indirectly, including equity and debt, listed funds, derivatives and alternative investments (e.g., public equity, real assets, infrastructure, and hedge funds).

Ms. Traeger has significant experience advising a variety of financial institutions. Immediately prior to joining TRS, Ms. Traeger was a partner at O’Melveny & Myers LLP, in Washington, D.C., in the Financial Services Practice. Previously, she served as an Associate Counsel at the Investment Company Institute (ICI) and in several positions at the U.S. Securities and Exchange Commission, including as the Senior Counsel to Commissioner Roel Campos, Counsel to Commissioner Issac Hunt, and Senior Counsel in the Division of Market Regulation (now Trading and Markets). She also clerked for the Texas First Court of Appeals.

Ms. Traeger has written numerous articles and chapters on investment adviser and broker dealer regulatory and compliance issues. She also participates regularly in industry panels. Ms. Traeger is a faculty member for the Regulatory Compliance Association’s CCO University, a member of the ILPA Legal Advisory Council, and serves on the Board of the Association of Securities and Exchange Commission Alumni. She is a member of Texas Wall Street Women, serving on the Philanthropy Committee, and participates in the National Society of Compliance Professionals, the Austin and Houston Compliance Roundtables, and the Council of Public Fund Compliance Officers.

In addition, Ms. Traeger serves on the board of Make-A-Wish Central & South Texas. While in Washington, D.C., she served as a member of the Board of Editors for the Investment Lawyer, and was a faculty member for Operation HOPE, Banking on Our Future, as well as a member of the Women’s White Collar Defense Association and Women in Housing and Finance.

Ms. Traeger is a member of the Texas and District of Columbia bars.


Lorna Schnase has been practicing corporate and securities law for more than 25 years. Her practice emphasizes investment management matters, primarily for registered investment advisers and mutual funds. Ms. Schnase counsels clients regarding a wide range of matters such as compliance programs, fiduciary duty, disclosure, custody, organizational issues, registration of funds and advisers with the Securities and Exchange Commission, performance issues, adviser and fund advertising, changes of control, best execution, soft dollars, codes of ethics, director independence and other corporate governance issues, reporting obligations, electronic document delivery, privacy compliance and other issues.

Ms. Schnase practices independently in Houston, Texas. Prior to establishing her independent practice, she was a partner of the law firm of Davis, Graham & Stubbs LLP. Prior to that, Ms. Schnase practiced with the law firm of Baker & McKenzie in Los Angeles and with the Dechert law firm in Denver. She is a member of the Advisory Board of the Mutual Fund Directors Forum and the Editorial Advisory Board of the journal “Practical Compliance & Risk Management for the Securities Industry.”

Ms. Schnase graduated cum laude from Harvard Law School with a J.D. degree in 1982. In 1979, Ms. Schnase graduated summa cum laude from the University of Denver with a B.A. degree in mathematics. She was elected to Phi Beta Kappa and the Mortar Board honors society.  She is a member of the bar in the States of Texas (1991), California (1989) (inactive) and Colorado (1982) (inactive).


Peter M. Rosenblum is a partner at Foley Hoag LLP, a co-chair of its Mergers & Acquisitions Group and chairman of its Private Equity Transactions Group.  He is actively involved in the firm’s corporate, corporate finance and international practices.  His clients include private equity and venture capital funds, registered investment advisers, hedge funds, and other private funds, both onshore and offshore.  He is active in representation of investors in private equity, venture capital and other private funds.  He has structured and organized numerous partnerships, limited partnerships, limited liability companies and offshore companies employed in the management and ownership of investments in public and private securities and alternative investments.  He is principal outside counsel to numerous clients in a broad range of other industries.

Mr. Rosenblum was Chairman of Foley Hoag’s Business Department from 2008 to 2011, a member of its Executive Committee from 2013 to 2016, and Co-Managing Partner from 2000 to 2005.  He was Chairman of the Corporate Law Committee of the Boston Bar Association from 1995 to 1997 and Chairman of the Business Law Section of the Boston Bar Association from 1997 to 1999.

Mr. Rosenblum has been listed in The Best Lawyers in America since 1999.  He is also listed in Chambers U.S.A.: America’s Leading Business Lawyers for private equity-buyouts and venture capital investment and corporate/mergers and acquisitions and in Legal Media Group’s Guide to the World’s Leading Lawyers for Banking, Finance and Transactional Law for investment funds and private equity, and was listed in Chambers Global: The World’s Leading Lawyers for Business for private equity-buyouts and venture capital investment.

Mr. Rosenblum graduated, summa cum laude, from Amherst College, and received his M.A. in History from Yale University and his J.D., cum laude, from Harvard Law School.  Prior to entering the private practice of law, he served as Law Clerk to Chief Justice G. Joseph Tauro of the Massachusetts Supreme Judicial Court.  He is Chairman of the Boston Lawyers Group and a member of the Board of Directors of Ceres, Inc.  He is a member of the Society of Investment Law.

Mr. Rosenblum has written and lectured on a wide variety of subjects related to investment advisers and private funds.  He is the author of “Offshore/Non-U.S. Advisers” and “Overview of Institutional and Offshore Advisory Activity” in C. Kirsch, Investment Adviser Regulation (2006, 2008, 2016) and “Organization of a Private Investment Fund: Basic Structural and Legal Issues” in C. Kirsch, Financial Product Fundamentals (New York 2006, 2009, 2013).


Steven W. Stone is a securities lawyer who counsels clients on regulations governing broker-dealers, investment advisers and bank fiduciaries, and pooled investment vehicles. Head of the firm’s financial institutions practice, Steve counsels most of the largest and most prominent US broker-dealers, investment banks, investment advisers, and mutual fund organizations. He regularly represents clients before the US Securities and Exchange Commission (SEC), both in seeking regulatory relief and assisting clients in enforcement or examination matters.

Steve advises major US broker-dealers in the private wealth and private client businesses that offer investment advice and brokerage services to high-net-worth clients as well as broker-dealers serving self-directing clients. He also works as counsel on various matters to the Securities Industry and Financial Markets Association’s (SIFMA) private client committee and represents most of the best-known US broker-dealers in this area. He also advises broker-dealers and investment advisers in the managed account or wrap fee area, and serves as counsel to the Money Management Institute, the principal trade association focused on managed accounts. Steve also counsels various institutional investment advisers and banks on investment management issues, including conflicts, trading, disclosure, advertising, distribution, and other ongoing regulatory compliance matters.

Steve’s practice includes counseling clients on varied regulatory and transactional matters. Additionally, he counsels clients on mergers, acquisitions, and joint ventures involving broker-dealers and investment advisers.


Theodore E. Eichenlaub is a Founding Partner of ACA Compliance Group where he is primarily responsible for coordinating ACA’s review program of investment advisers and alternative asset managers.  Mr. Eichenlaub additionally oversees ACA’s regulatory filings team and its initiatives related to the use of information technology to fulfill regulatory requirements.  Finally, Mr. Eichenlaub oversees the development and maintenance of the different types of written deliverables furnished to clients.

Mr. Eichenlaub served in the SEC’s Office of Compliance Inspections and Examinations from 1996 to 2002, conducting examinations of investment companies, mutual fund administrators, transfer agents, variable insurance product sponsors, hedge funds and investment advisers.  In addition, Mr. Eichenlaub served as liaison to the SEC’s Boston District Office and Hong Kong’s Securities and Futures Commission.  Mr. Eichenlaub is a frequent speaker at industry conferences and has been quoted in numerous industry publications, including Investment News, Pensions & Investments, Ignites, FundFire, ACA Insight News, IA Week and The Wall Street Journal.  Mr. Eichenlaub is a graduate of the Pennsylvania State University with a B.S. in Finance and a minor in Economics.


Vanessa Scott is a partner in Sutherland’s Washington DC tax practice, where she advises on employee benefits and matters related to the Employee Retirement Income Security Act (ERISA).  Ms. Scott counsels domestic and international  insurers on a wide range of regulatory and compliance matters relating to ERISA-governed benefits and retirement services products. She is nationally recognized for her insight on Patient Protection and Affordable Care Act (PPACA) issues, and is a sought-after speaker on the Department of Labor’s (DOL) re-proposal on the definition of investment advice fiduciary.

Ms. Scott is focused on providing creative legal solutions for insurers operating in a quickly changing market. Her experience includes assisting one of the world’s largest international specialty reinsurers with ERISA issues associated with surplus and excess lines, stop-loss insurance, catastrophic coverage and specialty health risks. Ms. Scott also drafted several comment letters regarding the DOL’s fiduciary re-proposal on behalf of insurance groups and financial services firms. As a member of Sutherland’s Privacy and Data Security team, Ms. Scott also has experience advising on Health Insurance Portability and Accountability Act (HIPAA) issues, state health privacy laws, and claims-related cyber risk exposure.

Ms. Scott’s unique practice combines her proficiency with the technical rules that govern ERISA-governed benefits and products with her policy experience as a former Congressional aide and federal government relations representative. She frequently represents her clients’ interests before federal and state agencies and the National Association of Insurance Commissioners, and she has testified before members of Congress on insurance matters relating to the PPACA and healthcare transparency.

Ms. Scott is frequently quoted in the trade press and national publications, and she was named a Washington, D.C. Super Lawyer for the third time in 2015. She serves as Sutherland’s national Chief Diversity Officer  and is an adjunct professor at the Georgetown University Law Center. She attended Duke University and the Vanderbilt University School of Law, and she holds an LL.M. in Taxation from the Georgetown University Law Center.


Chris is the General Counsel for Loring Ward Holdings Inc. and its investment advisory and broker-dealer subsidiaries. In this role he provides legal advice and counseling related to federal and state securities laws, SEC and FINRA rules, investment management compliance, corporate governance, risk management, transition and succession planning, and general corporate legal matters.

Chris worked for Loring Ward during law school as a part-time legal clerk, and eventually transitioned into a full-time role. His tenure at Loring Ward has included stints as Director of Compliance (from November 2009 to March 2011), Chief Compliance Officer (from April 2011 to October 2015), and General Counsel (from April 2011 to present). He also served as the Chief Legal Officer and Chief Compliance Officer for the SA Funds – Investment Trust, a mutual fund family advised by Loring Ward, from April 2011 to March 2016. Previously, he served as a Summer Associate for the law firm of Bell, Rosenberg and Hughes LLP (now Kilpatrick Townsend & Stockton, LLP).

Chris' writings are regularly featured in ThinkAdvisor, and have also been published by the Journal of Financial Planning. In addition, he has been a speaker at conference panels hosted by the Investment Adviser Association, Investment Company Institute, State Street Bank & Trust Co., National Regulatory Services and K&L Gates LLP. He has been quoted in Investment News, On Wall Street, Financial Advisor IQ, NAPFA, IAWatch, Law360 and the Los Angeles Daily Journal. His writings can be found at his personal website, beachstreetlegal.com.

Chris is an attorney admitted to the State Bar of California and the District of Columbia. He also has passed the FINRA Series 7 General Securities Representative and Series 24 General Securities Principal examinations, as well as the NASAA Series 66 examination. He received both a Juris Doctor and Masters of Business Administration from Santa Clara University, and a Bachelor of the Arts from Boston College.


Mr Rutledge is a partner of Bybel Rutledge LLP, Harrisburg, PA where his practice focuses on corporate and securities law, regulation of financial intermediaries and regulatory representation.  He is a nationally recognized expert in securities regulation and was instrumental in shaping various provisions of the Securities Markets Improvement Act of 1996, the Gramm-Leach-Bliley Financial Modernization Act of 1999 and the Sarbanes-Oxley Act of 2002. He has served as an expert witness for the Pennsylvania Office of Attorney General and has prepared expert opinions and testified as a securities expert before the U.S. Senate Permanent Subcommittee on Investigations, in FINRA arbitrations and in civil litigation.

Mr. Rutledge has taught securities regulation at Widener University School of Law, The Dickinson School of Law of the Pennsylvania State University and the FINRA Compliance Certificate Program at The Wharton School, University of Pennsylvania.  He currently holds an appointment as a Tutor, Centre for Financial and Management Studies, University of London. In 2015, he was appointed Visiting Professor in Securities Law and Regulation in the LLM Program at BPP University, London.  He routinely is a guest lecturer at the Cambridge International Symposium on Economic Crime held at Jesus College, University of Cambridge, England.

He writes extensively in his area, most recently contributing chapters on State Regulation of Broker Dealers and State Regulation of Investment Advisers for the Practising Law Institute’s  multi-volume Treatise on Broker-Dealer Regulation and Investment Adviser Regulation, respectively.  He also is the author of books on Electronic Markets and Civil and Administrative Liability under Pennsylvania Securities Law and has written chapters for The Sarbanes-Oxley Handbook, The Fiduciary, the Insider and the Conflict, and International Tracing of Assets.  His legal articles have appeared in the Banque de France Financial Stability Review, ABA Business Lawyer, Journal of European Financial Services Law, The Dickinson Journal of International Law, Journal of Financial Crime and The Company Lawyer.

Mr. Rutledge is a member of the Securities Regulation Advisory Committee for the American Law Institute and the Securities Advisory Committee of the Pennsylvania Department of Banking and Securities.  He also served on the Board of Editors of the ABA Business Lawyer.   For the past five years, he has been named in The Best Lawyers in America and, in 2015, was named “Lawyer of the Year” in Central Pennsylvania for his expertise in securities and securities regulatory matters.

He is a member of the Council of the Business Law Section of the Pennsylvania Bar Association and is Chair of its Securities Regulation Committee.  In 2009, he received the Freedom of the City of London in the Worshipful Company of Pattenmakers. In 2010, he was appointed to the Editorial Advisory Board of the Centre for Business Law, University of the Free State, in the Republic of South Africa.


Kenneth J. Berman is a partner with Debevoise & Plimpton LLP, resident in the firm’s Washington, D.C. office.  Mr. Berman focuses his practice on providing regulatory and compliance advice to financial services firms, particularly investment advisers and sponsors of mutual funds, private equity funds and other pooled investment vehicles. 

Prior to joining Debevoise, Mr. Berman was Associate Director of the Securities and Exchange Commission’s Division of Investment Management, where he oversaw the division offices responsible for processing applications for exemptive relief under the Investment Company Act and administering the Public Utility Holding Company Act of 1935. He joined the SEC staff in 1988 after several years of private practice. Before becoming Associate Director in 1997, Mr. Berman was Assistant Director of the Division’s Office of Regulatory Policy.

Mr. Berman is the co-author of numerous articles, including “Debevoise & Plimpton Discusses Custody Of Digital Assets,” The CLS Blue Sky Blog (January 8, 2019); Debevoise & Plimpton Discusses SEC Enforcement Against Private Equity Advisers The CLS Blue Sky Blog (Dec. 24, 2018); OCIE Pings Advisers on Electronic Messaging Best Practices,” (December 21, 2018);” 2018/2019 Private Equity Year End Review and Outlook” (December 20, 2018); “Debevoise On Material Omissions In Private Equity Secondary Transaction,” The CLS Blue Sky Blog (October 9, 2018); “Beware Pitfalls In Private Equity Secondary Transactions,” Law 360 (October 3, 2018);   “What Will The ‘Eyes And Ears’” Of The SEC Choose To See And Hear This Year? OCIE Announces Examination Priorities For 2015,” Vol. 16 No.2, Journal of Investment Compliance, (July, 2015); “Debevoise & Plimpton Discusses JOBS Act General Solicitations,” The CLS Blue Sky Blog (September, 2014);; and “Soft Dollars and Other Means of Obtaining Business” (Ch. 14 of Broker-Dealer Regulation).  He is also co-editor of International Survey of Investment Adviser Regulation (3rd ed.).

Mr. Berman is a member of the Association of the Bar of the City of New York (Investment Management Regulation Committee), the American Bar Association (Subcommittee on Investment Companies and Investment Advisers, Subcommittee on Private Investment Entities) and the District of Columbia Bar. 

Mr. Berman received his J.D. from the University of Chicago Law School and his B.A. from Dickinson College.


Maureen Baker Fialcowitz is the Chief Legal Officer, PGIM Public Side Businesses.  Maureen provides legal support to PGIM, the Global Investment Management Businesses of Prudential Financial, Inc., specifically, PGIM Fixed Income, Jennison Associates LLC, QMA LLC and PGIM Investments LLC.  Maureen joined Prudential's law department in 1993 following four years of private practice with the New York law firm, Dewey Ballantine.  Her practice areas include investment management, securities and general corporate law.

Maureen received a B.A. from Georgetown University (cum laude) and a J.D. from Fordham University School of Law, where she also served on the Editorial Board of its Law Review.  She is an active member of the Investment Adviser Association, the Asset Management Group of SIFMA, the Institutional Investors Legal Forum and the Association of the Bar of the City of New York (Investment Management Regulation Committee).  Maureen is also a member of the bars of the States of New York and New Jersey as well as the District of Columbia.


Steven A. Yadegari is Chief Operating Officer and General Counsel of Cramer Rosenthal McGlynn, LLC, a registered investment adviser located in New York.  Mr. Yadegari also serves as Chief Legal Officer and Chief Compliance Officer for the CRM Mutual Fund Trust and is a Director of the CRM UCITS PLC.  Prior to joining CRM, Mr. Yadegari worked at K&L Gates and before that Proskauer.  Mr. Yadegari also has served as Senior Counsel in the Office of the Chief Counsel, Division of Enforcement at U.S. Securities and Exchange Commission and as an Attorney-Adviser in the Division of Market Regulation.  He is a frequent contributor to industry conferences and publications.  In 2007, Mr. Yadegari was recognized as a top twenty “Rising Star of Compliance” by Institutional Investor.  Mr. Yadegari is an adjunct professor at Benjamin N. Cardozo School of Law and teaches in the areas of dispute resolution and negotiation.  Mr. Yadegari is a Past President of the Association for Conflict Resolution of Greater New York, a not-for-profit organization, and is a Past President and former Chairman of the Old Westbury Hebrew Congregation.  Mr. Yadegari has received a BA from Brandeis University and earned his JD from the Benjamin N. Cardozo School of Law.  Mr. Yadegari has been awarded an honorary Master’s Degree from the CCO University, a division of the Regulatory Compliance Association for which he serves as an advisor and senior fellow.


Ben Alden is General Counsel of Betterment, an automated investment service that manages over $5 billion in assets for more than 175,000 customers. In this role, Ben provides legal and business counsel to the company and manages its in house legal team, as well as outside counsel. Prior to joining Betterment, Ben worked as an associate at Spears & Imes and Sullivan & Cromwell, and served as a law clerk to Judge Colleen McMahon on the United States District Court for the Southern District of New York. He also has experience working as a management consultant. Ben earned his B.A. from Cornell University, and his J.D. from Stanford Law School.


Michael Hershaft is a Senior Special Counsel in the Office of Compliance Inspections and Examination's (OCIE) Office of Chief Counsel. In this role, he provides legal advice and guidance to the SEC's National Examination Program.  In 2015, Michael served as a counsel to SEC Commissioner Daniel M. Gallagher and advised the Commissioner on enforcement matters, policy issues and rulemakings.  Prior to joining OCIE in 2011, Michael was a special counsel in the Division of Trading and Markets (TM) Office of Chief Counsel.  From 2008 to 2010, he served as a counsel to the TM Director.  In this capacity, he advised the director on legal and policy issues, including the implementation of the Dodd-Frank Act.  Prior to joining the SEC in 2005, Michael was an associate at WilmerHale where he advised financial institutions on regulatory and enforcement matters.  He also served as a law clerk to Judge John M. Duhe, Jr. of the U.S. Court of Appeals for the Fifth Circuit.  He received his BS and MS in journalism from Northwestern University and his JD from the University of Chicago Law School.