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Overview of the Topics To Be Covered
Custody 101: Custody Rule Basics and Practical Compliance Advice
Custody 201: General Compliance Issues under the Custody Rule
Extra Credit: Custody Conundrums
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Custody 101: Custody Rule Basics
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What is “Custody”?
The SEC staff interprets “custody” broadly, including where the RIA or its related person holds, directly or indirectly, the assets – i.e., the RIA or its related person either possesses or has the authority to obtain the assets, even if access to those assets is temporary and/or never used.
The Custody Rule includes a myriad of technical requirements, not all of which make sense in the context of safekeeping of assets.
An RIA or its related person generally have custody where the adviser:
• Has possession of client funds or securities (unless they were received inadvertently and the adviser returns them to the client within three business days of receipt);
• Has a general power of attorney under which the adviser is authorized or permitted to withdraw client funds or securities;
• Is a GP of a limited partnership, a managing member of an LLC, a trustee of a trust, or a person with similar legal ownership of or access to client funds or securities;
• Receives proceeds from the redemption of client securities; • Can write checks or withdraw funds from its client’s account; or • Has authority to dispose of client funds or securities for any purpose other than “authorized
trading,” can deduct fees or other expenses from a client’s account or can direct cash flows from the client’s account.
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What is “Custody”?
According to the SEC staff, an adviser can have custody where the custodial agreement binds the custodian to act on instructions of the adviser, even if the advisory agreement restricts the adviser (so-called “inadvertent custody”).
SEC staff has also indicated that an adviser may have custody where it has entered into a standing letter of instruction or similar asset transfer authorization (“SLOA”).
The staff has indicated that under certain circumstances adviser authorization to transfer assets between a client’s own accounts will not constitute custody.
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What is a “Client” under the Custody Rule?
• Any person or entity receiving investment advice, including accounts that pay no fees (e.g., family members).
• An adviser may not have to comply with the custody rule, however, with respect to assets in private funds owned solely by the adviser’s principals, their family members and/or their family trusts.
• Includes pooled investment vehicles (PIVs) or separately managed accounts (SMAs).
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What are “Funds and Securities”?
“Funds” include cash or cash equivalents.
“Security” is defined broadly under the Advisers Act and
includes bonds, notes, stocks, security futures, evidence of
indebtedness (e.g., loans and mortgages), options on
securities and security-based swaps.
“Security” definition under Advisers Act and Investment Company Act is broader than
under the Securities Act or Securities Exchange Act, which
causes considerable confusion.
The Custody Rule does not apply to assets that are neither “funds” nor “securities,” such
as commodities and real estate that is directly owned.
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Practical Compliance Advice
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Custody 201: General Compliance Issues
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Extra Credit : Custody Conundrums
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Real Estate
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Digital Assets
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Additional Materials
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“Maintained” with a “Qualified Custodian”
With limited exceptions for mutual fund shares and certain privately offered securities, the Custody Rule requires an RIA with custody to maintain client funds and/or securities with a “qualified custodian.”
Generally, a “qualified custodian” must be a bank, broker-dealer or registered FCM.
Funds and securities must be kept in a separate account for each client under that client’s name or in accounts that contain only clients’ funds and securities, under the adviser’s name as agent or trustee for the clients. Client assets may not be commingled with the adviser’s assets.
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“Maintained” with a “Qualified Custodian”
It is not always clear how precisely to “maintain” certain securities – e.g., loans or swaps – with the qualified custodian.
“Self-custody” – an RIA or its related person that meets the “qualified custodian” definition may “self-custody.” The RIA must obtain an internal control report prepared by an independent public accountant overseen by the PCAOB and must undergo an annual “surprise” verification of assets (unless the RIA has custody solely because the related qualified custodian has custody of the RIA’s client assets and the related qualified custodian is “operationally independent” from the RIA).
“Privately offered securities.” An adviser is not required to maintain securities with a qualified custodian if they are privately offered, uncertificated and transferable only with prior consent of the issuer or outstanding holders. Under certain circumstances, private stock certificates are not required to be maintained with a qualified custodian.
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Reporting Requirements
Quarterly statements + surprise audit. The adviser must have a reasonable basis, after due inquiry, for believing that the qualified custodian sends an account statement, at least quarterly,
directly to each client and pooled vehicle investor for which the custodian
maintains funds and/or securities, identifying the amount of funds and of each security in the account at the end
of the period and setting forth all transactions in the account during the period and must undergo a “surprise
examination” by an independent auditor at least once per year.
Audit exemption for pooled vehicles. The adviser will be
deemed to have complied with the Custody Rule if it prepares audited financial statements in accordance
with GAAP and GAAS and delivers to the fund investors within 120 days of the fund’s fiscal year end for a direct
trading private fund or within 180 days of the fund’s fiscal year end for a fund of funds. In addition, the fund
must conduct a final audit and distribute to the investors “promptly”
upon liquidation of the pool.
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“Qualified Custodian”
“Qualified Custodian”Includes:
Banks
(as defined in the Advisers Act and clarified in SEC staff guidance—what is/is not a “bank” is NOT as obvious as it seems)
Savings & Loans
Registered Broker-Dealers
Futures commission merchants registered
with the CFTC
Exception for mutual fund transfer agents who may be used in lieu of a
Qualified Custodian
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“Qualified Custodian”
RIA must maintain Client assets with a Qualified Custodian either in:
A separate account for each Client under that Client’s name
Accounts that contain only Clients’ Funds & Securities, under the RIA’s name as agent or trustee for the Clients.
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“Qualified Custodian”
What about the RIA who acts as the Qualified Custodian or uses a related Qualified Custodian?
Needs at occupational level
Needs at individual level
• SEC staff perceives the arrangement as a higher risk to Clients.
• To address the risk, the RIA must (1) obtain or receive from its related custodian, as applicable, an internal control report from an independent accountant and (2) arrange for a surprise verification of assets (except where the RIA has Custody due solely to the related Qualified Custodian’s custody of the assets and related Qualified Custodian is “operationally independent” from RIA).
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Special Treatment for “Privately Offered Securities”
Generally, RIAs need not, however, maintain “privately offered securities” with a Qualified Custodian.
• Acquired from the issuer in a transaction or chain of transactions that do not involve a public offering;
• Uncertificated, and ownership thereof is recorded only on the books of the issuer or its transfer agent in the name of the Client; and
• Transferable only with prior consent of the issuer or holders of the outstanding securities of the issuer.
“Privately offered securities” are securities that are:
The exception, which is available to both SMAs and PIVs, is available to PIVs only if the PIV is audited and the financials are distributed, all in accordance with the requirements of the “Audit Exemption.”
A security must satisfy each of the three prongs above to be considered a “privately offered security,” and there are some troubling conundrums…
• RIA must notify Clients and fund investors (unless fund is subject to Audit Exemption) promptly in writing of the Qualified Custodian’s name and address and how the Funds and/or Securities are maintained by that custodian at the time the account is opened and upon any changes to the information in the prior notice.
• RIA must have a reasonable basis after due inquiry for believing that the Qualified Custodian sends an account statement (1) at least quarterly, (2) directly to each Client and fund investor (but delivery requirement is not satisfied if the fund investor is also a fund and are the RIA’s related persons), (3) identifying the amount of Funds and of each Security in the account at the end of the period along with all transactions in the account during the period.
• Must be undertaken by an independent public accountant that meets additional requirements;
• Must be conducted once during each calendar year (generally, within the first within six months of the RIA becoming subject to the requirement) to (1) verify that the Client assets exist, (2) reconcile all such assets to the RIA’s books and records of its client accounts, (3) confirm such information with the RIA’s Clients;
• Are subject to a number of other requirements.
Notice
Reports
Surprise Exam
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The “Audit Exemption” for PIVs
Providing to the PIV investors audited financial statements prepared and delivered as specified in the Custody Rule.
Maintaining the Client’s Funds and/or Securities with a Qualified Custodian, if and as required
Regarding PIVs, including a single investor fund, an RIA may comply with the Custody Rule (and not be subject to the Notice and Reporting requirements and be deemed to have complied with the Surprise Exam requirements) by:
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The “Audit Exemption” for PIVsNotable requirements of the Audit Exemption:
PIV must be audited in accordance with GAAS at least annually and upon liquidation.
Auditor must be registered with, and subject to inspection by, the PCAOB.
PIV must distribute the audited financial statements, prepared in accordance with GAAP to investors within 120 days following the PIV’s fiscal year end (with extensions for FOFs) and “promptly” upon liquidation of the pool.
Financials must be distributed to the PIV investors that are not funds related to the RIA.
PIVs wholly owned by other funds advised by the RIA may be included in the scope of the pertinent upper tier fund.
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“Authorized Trading” is not “Custody”
• BUT WHAT IS “AUTHORIZED TRADING”?
• Famous Footnotes from the 2003 Adopting Release:
Footnote 5 states that “Custody” is “control of client funds or securities for purposes other than authorized trading.”
Footnote 10
Describes “authorized trading” as “the authority to issue instructions to a
broker-dealer or custodian to effect or to settle trades”; and
Provides a brief description of the “delivery v. payment” system as an
example, noting that “Clients’ custodians are generally under instructions
to transfer funds (or securities) out of a client’s account only upon
corresponding transfer of securities (or funds) into the account. This
delivery versus payment arrangement minimizes the risk an adviser could
withdraw or misappropriate the funds or securities in its client’s custodial
account.”
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Recent Tri-Part Custody Guidance Regarding “Custody” and SMAs
FAQ 11.4 – RIA’s restricted authority to transfer assets between or among Client’s own accounts held with Qualified Custodians (first-party transfers)is not Custody.
IAA N-AL – A standing letter of authorization (“SLOA”) authorizing a Qualified Custodian to transfer assets upon the RIA’s instruction to a third party for purposes other than Authorized Trading IS Custody, but there will be no enforcement recommendation under certain conditions, even if no surprise exam.
IM Guidance Inadvertent Custody – a nightmare of troubling conundrums…
Client must authorize RIA in a signed writing to make such transfers.
Generally, a copy of the authorization must be provided to the sending custodian, specifying the Client accounts – i.e., name and account numbers on sending and receiving accounts (including ABA routing number(s) or name(s) of receiving custodian).
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“Inadvertent Custody” and FAQ Modifications -The Nightmare
• The RIA is not a party and
• The authority in the custodial agreement conflicts with the
RIAs agreement with the Client.
IM Guidance –Inadvertent Custody may be imputed to an RIA when the
custodial agreement between the Qualified Custodian and
the Client permits the Qualified Custodian to accept
instructions from the RIA to transfer assets from the
account for any purpose other than authorized trading even if
• FAQ II.11—no enforcement if an RIA who does not have the custodial agreement, does not have reason to know its provisions and did not recommend the Qualified Custodian neither complies with the Custody Rule requirements nor reports Custody on its Form ADV
• FAQ II.12—an RIA as described in FAQ II.12 must still comply with applicable Custody Rule requirements if, e.g., it separately has authority to deduct fees and write checks
New FAQs
substantially modify the IM Guidance
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“Privately Offered Securities”
What securities qualify as “uncertificated securities”?
• Per SEC staff guidance, partnership agreements, subscription agreements, LLC agreements and ISDA master agreements are not certificated securities and even some privately offered certificated equity securities enjoy relief under certain circumstances.
• In the absence of additional specific guidance, we would expect other examples to include debt or equity interests in a private company and other types of customized agreements (e.g., assignments and customized agreements that are not negotiable instruments).
What securities are “transferable only with prior consent of the issuer or
holders” – do bank loans, mortgage loans & other types of loans satisfy
this prong?• To the extent such loans are not vulnerable to misuse or misappropriation by
the RIA and therefore do not require the protection of a Qualified Custodian, it is reasonable to take the position that privately negotiated debt securities that are not readily negotiable and meet the other prongs also should qualify for the exception.
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Liquidation Audit
YES! The liquidation audit is a fundamental condition of the Audit Exemption designed to assure liquidation proceeds are appropriately accounted for and provide investors an opportunity to take timely steps to protect their rights.
Answer 1
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Liquidation Audit
The SEC staff has not provided guidance as to the definition of “upon liquidation,” but the American Institute of CPAs (“AICPA”) has commented that the financial statements (1) should be dated as of or near the final distribution date (and generally would not be distributed prior to the final fund distribution to investors) and (2) can cover more than a 12 month period if they are delivered to investors within the 120 days of the PIV’s FYE, provided they include two balance sheets, two income statements, two statements of changes in partners’ capital and two statements of cast flows, as applicable, one of each as of the FYE and one for the period from the FYE to the liquidation date.
Answer 2
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Liquidation Audit
There is no SEC comfort for omitting the liquidation audit! And it is important to wrap up well, especially where the adviser is ceasing operations and the employees want to move on.
Answer 3
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Special Purpose Vehicles (“SPVs”)
Provided an SPV has no owners other than the RIA, its related persons
and/or their PIVs, an RIA relying on the Audit Exemption has the
option to treat:
• The SPV as a separate Client and
separately audit the SPV or
• The SPV’s assets as assets of the
fund and consider those assets
“within the scope” of the fund’s
audited financials.
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Dreaded Scenario 4
If an investment vehicle has owners other than those
described above, the vehicle may share characteristics
with an SPV, but it is not an SPV—it is an investment
fund that should be treated as a separate Client for
purposes of the Custody Rule, and the RIA must comply
separately with the Custody Rule’s audit and audited
financial statement distribution requirements with
respect to such investment fund.
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SMAs, IMAs and the Custody Rule
• NOT INCLUDE language that could be construed to confer authority that constitutes Custody and
• INCLUDE clear language indicating the RIA does not have Custody
Where an RIA does not accept Custody, it is important the SMA IMA
• Client grants RIA authority to act as Client’s agent and attorney-in-fact to issue instructions to a broker-dealer or a custodian to effect or to settle trades for and on behalf of Client with respect to the account
• Assets will be held by a custodian selected by the Client in an account opened by the Client and notified by the Client to the RIA
• Client acknowledges that RIA will at no time have “custody” of the assets in the account as that term is defined in Rule 206(4)-2 under the Advisers Act
Assuming the RIA has discretionary authority, the IMA terms should indicate, at a minimum, that:
The facts must support the provisions indicating the RIA does not have Custody
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The Custody Rule—Perennial Compliance Issue
Noted widespread deficiencies in compliance due to, e.g.,
• Unsurprising “surprise” exams and • Failure to recognize “Custody,” e.g., where RIA
o Has personnel or a related person who serves as trustee or has POA for Client accounts
o Provides bill-paying services for Clientso Had online access to, and ability to withdraw from,
Client accountso Received checks for Clients and failed to return
promptly to sender
2013 Risk Alert
2017 Risk Alert
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Audit-Related Deficiencies in the 2013 Risk Alert
Accountant was not “independent” as required by the Custody Rule.
Audited financial statements were not prepared in accordance with GAAP (e.g., organizational expenses were improperly amortized rather than expensed as incurred resulting in a qualified audit opinion…).
Adviser failed to demonstrate that the audited financials were distributed to all fund investors—instead it appeared the statements were made available “upon request”
Audited financials were not sent to investors within the required time frame (120, 180, 240 days, as applicable).
4
3
2
1
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Audit-Related Deficiencies in the 2013 Risk Alert
Auditor was not PCAOB-registered and subject to PCAOB inspection.
Final audit was not performed on liquidated PIVs.
Adviser requested investor approval to waive the annual financial audit of a fund—but did not obtain a surprise examination thereby failing to either undergo a surprise exam or comply with the Audit Exception.
Some PIVs were using financial statements that were not prepared in accordance with GAAP or audited in accordance with GAAS without satisfying the conditions set out in the guidance.8
7
6
5
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Auditor Independence Rule—Enforcement In Re Holthouse Carlin & Van Trigt LLP (“HCVT”) (September 13, 2018)
In 2012 HCVT began auditing private funds managed by RIAs.
HCVT conducted 57 audits for four RIAs between 2012 and 2016.
Under the Auditor Independence Rule (Regulation S-X), an auditor is not independent if the accountant provides certain bookkeeping or other services related to the accounting records or
financial statements, unless it is reasonable to conclude that the results of those services will not be subject to audit procedures during the audit of the audit client’s financial statements.
HCVT’s P&P, controls and training (1) incorrectly referenced the independence standards issued by the AICPA, which allow auditors to prepare their clients’ financial statements and still maintain
their independence as long as the client assumes responsibility for the financial statements, rather than Regulation S-X’s independence standards and (2) failed to make clear that the
independence standards of Regulation S-X govern audits under the Custody Rule.
HCVT thereby caused the RIAs to violate the Custody Rule.
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Recordkeeping and CustodyAdvisers Act Rule 204-2—the Books and Records Rule:
A journal or other record showing all purchases, sales, receipts and deliveries of securities (including certificate numbers) for such accounts and all other debits and credits to such accounts.
A memorandum describing the basis upon which you have determined that the presumption that any related person is not operationally independent under §275.206(4)-2(d)(5) has been overcome.
A separate ledger account for each such client showing all purchases, sales, receipts and deliveries of securities, the date and price of each purchase and sale, and all debits and credits.
Copies of confirmations of all transactions effected by or for the account of any such client.
A record for each security in which any such client has a position, which record shall show the name of each such client having any interest in such security, the amount or interest of each such client, and the location of each such security.
1
2
3
4
5
If an investment adviser subject to paragraph (a) of this section has custody or possession of securities or funds of any client, the records required to be made and kept under paragraph (a) of this section shall include:
• Are Bitcoin, Ethereum or other digital assets “Funds” or “Securities”?
• Dalia Blass, Director of Division of Investment Management to the Investment Company Institute and the Securities Industry and Financial Markets Association, Staff Letter: Engaging on Fund Innovation and Cryptocurrency-related Holdings, January 18, 2018:
o Cryptocurrency related holdings raise “significant outstanding questions concerning how funds holding substantial amounts of cryptocurrencies and related products would satisfy the requirements of the 1940 Act and its rules”, including custody and safekeeping.
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Digital Assets
SEC Chairman Jay Clayton, CNBC, June 6, 2018:
o When asked about Ethereum, he would not comment on specific
digital assets, but he stated that cryptocurrencies that are a
replacement for sovereign currencies are “not securities”.
o A digital asset used to raise money for a venture in exchange for
a return from the venture or on the secondary market is a
security.
• Tokens as securities vs. tokens as “investment contract” securities under certain circumstances
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Digital Assets
o “Applying the disclosure regime of the federal securities laws to the offer and resale of Bitcoin would seem to add little value.”
o “And putting aside the fundraising that accompanied the creation of Ether, based on my understanding of the present state of Ether, the Ethereum network and its decentralized structure, current offers and sales of Ether are not securities transactions.”
o “If a promoter were to place Bitcoin in a fund or trust and sell interests, it would create a new security. Similarly, investment contracts can be made out of virtually any asset (including virtual assets), provided the investor is reasonably expecting profits from the promoter’s efforts.”
William Hinman, Director, Division of Corporation Finance, Digital Asset Transactions: When Howey Met Gary (Plastic), June 14, 2018:
LAURIE KLEIMAN is a global co-leader of Sidley’s Investment Funds, Advisers and Derivatives practice team. She represents a wide range of domestic and international investment funds and managers and is also a leader of the securities and derivatives enforcement and regulatory practice. Laurie is a frequent speaker on investment manager and fund regulation and compliance as well as on issues relating to the advancement of women in law.
Strong advocacy on behalf of her clients has earned Laurie acknowledgment in numerous industry publications, including Chambers USA, The Legal 500 and U.S. News & World Report. She is recognized in the area of Mutual Funds Law by The Best Lawyers in America®, with sources telling the publication: “Ms. Kleiman has been extremely professional and knowledgeable in her service to our firm. We trust her advice explicitly,” and “[Laurie] is a true expert in her area, and remarkably commercial and practical.” Laurie has also been included in articles in mainstream publications including Crain’s New York Business. She has been named to Crain’s New York Business’ inaugural “Leading Women Lawyers in New York City” list, where she was lauded as being among the 100 “trailblazing women” who have “found multiple paths to excellence” and have displayed “fierce determination, passion for the law, keen intelligence, and inspiring achievement.” Laurie has also been named one of the “50 Leading Women in Hedge Funds 2017” by the Hedge Fund Journal.
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Nathan A. Howell, JD, Partner, Sidley Austin LLP
NATE HOWELL is a partner in Sidley’s Chicago office in the Investment Funds, Advisers and Derivatives practice group. He also serves as a member of Sidley’s End-User Derivatives team and the Securities & Derivatives Enforcement and Regulatory practice group.
Nate’s practice focuses on futures and derivatives regulation, transactions and compliance, with a core focus on Commodity Exchange Act, Commodity Futures Trading Commission (CFTC) and Dodd-Frank Act matters. He also frequently advises clients on issues related to cryptocurrency, blockchain and distributed ledger technology, and tokenized assets. He understands the complexities of the current legislative and regulatory environment in the United States in light of the disruption caused by technology. Nate’s clients rely on him to understand all of this complexity, while providing practical and straightforward solutions.
Nate’s clients include clearing organizations, derivatives exchanges and other trading facilities, self-regulatory organizations, commodity pool operators, commodity trading advisors, futures commission merchants, introducing brokers, swap dealers, banks, hedge funds, commercial end-users of derivatives (including manufacturing and energy companies) and companies that are actively engaged in the cryptocurrency and digital assets space. Nate also advises a number of non-U.S. financial institutions on the cross-border aspects of U.S. derivatives regulations.
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Steven M. Felsenthal, JD, LLM, GC & CCO, Millburn Ridgefield CorporationSteven Felsenthal is a General Counsel and Chief Compliance Officers of MillburnRidgefield Corporation, a Registered Investment Adviser, Commodity Pool Operator and Commodity Trading Advisor and its US and international affiliates. He focuses on all legal and compliance issues relating to the firm’s operations.
Prior to joining Millburn in January 2004, Mr. Felsenthal was a senior associate in the investment management group at Schulte Roth & Zabel LLP, where he represented and advised hedge funds, registered investment companies, investment advisers, broker-dealers and banks in connection with all facets of their asset management businesses, and a member of the tax department of Kramer, Levin, Naftalis & Frankel LLP.
He graduated cum laude from Yeshiva University in 1991 with a bachelor of arts degree in political science and order of the coif from Fordham University School of Law in 1996, where he also served as an editor of the Fordham Environmental Law Journal. Mr. Felsenthal received an LL.M degree in taxation from New York University School of Law in 2001 and has written and been quoted in numerous published articles and spoken at conferences, on various topics related to investment management.
Mr. Felsenthal is a member of the New York State Bar, serves on National Futures Association’s Compliance and Risk Committee, is a past member of the Steering Committee of the Managed Funds Association’s CCO Forum, past Co-Chairman of the Managed Funds Association CPO/CTA Advisory Committee and a past member of its Steering Committee, a Faculty Member and Lecturer for the Regulatory Compliance Association and a member of the Editorial Board of the Journal of Securities Operations & Custody (formerly, the Journal of Securities Regulation and Compliance). He was also recognized by Institutional Investor as one of its 20 Rising Stars in September 2006.
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Kara J. Brown, JD, SVP, GC & Compliance Officer, Cabot Properties L.P.
Kara J. Brown has 13 years of legal experience focused primarily on regulatory compliance. Ms. Brown joined Cabot in September 2018 and is responsible for overseeing all legal support for Cabot and assisting the Chief Compliance Officer with implementation of Cabot’s compliance program.
Prior to joining Cabot, Ms. Brown was Counsel in Sidley Austin LLP’s Boston office and a member of the Securities and Derivatives Enforcement and Regulatory practice groups, providing legal advice to investment advisers offering real estate, credit, private equity and public equity strategies and funds. Ms. Brown previously served as in-house counsel and compliance officer for investment advisers including Glenview Capital Management and Neuberger Berman.
Ms. Brown hold a Bachelor of Science degree from the University of Massachusetts at Amherst, with honors and a Juris Doctor from Brooklyn Law School.
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Verity A. Van Tassel Richards, JD, Associate, Sidley Austin LLPVERITY VAN TASSEL RICHARDS focuses her practice on representing digital asset trading platforms, blockchain technology companies, U.S. and non-U.S. broker-dealers, financial services firms and cryptocurrency funds. Verity advises technology companies on blockchain token offerings, including so-called ICOs. She also counsels financial institutions and digital asset exchanges with day-to-day securities issues, private placement agent requirements, custody rule requirements, cross-border regulatory issues, money services business registration requirements and FINRA and SEC regulatory inquiries.
Verity works with transactional lawyers on structuring deals involving financial services and technology companies, digital asset exchanges and blockchain tokens. Verity advises blockchain entrepreneurs in the formation of nonprofit organizations and benefit corporations. She is an adjunct professor of law at the Benjamin N. Cardozo School of Law where she teaches The Law of Nonprofit Organizations.
Verity is a frequent speaker and writer on various topics in FinTech, with a particular focus on distributed ledger technology and blockchain tokens.
Prior to joining Sidley, Verity worked as an associate at another New York law firm. She was a judicial intern for the Honorable Dickinson R. Debevoise of the U.S. District Court for the District of New Jersey.
While in law school, Verity was an associate editor of the Cardozo Law Review and a Dean’s Distinguished Fellow.
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Cynthia L. Wells, JD, Staff Attorney, Sidley Austin LLP
CYNTHIA L. WELLS is a member of the firm’s Investment Funds, Advisers and Derivatives group. Her practice focuses on the representation of domestic and international investment funds and advisers. She is a member of the Sidley’s Associates Committee. Cynthia’s practice encompasses:
• Advice to both U.S. and non-U.S. managers to investment products of all types –including hedge funds, mutual funds, private equity funds, real estate funds, collateral managers and managed accounts – with respect to both U.S. federal and state investment adviser registration, regulation and compliance.
• Advice to financial institutions with respect to investment fund compliance and governance issues.
• Organization and registration of U.S. registered investment companies, including mutual funds, money market funds and closed-end funds.
Cynthia also has general corporate finance experience, particularly in investment grade debt securities and medium-term note programs.
