The Bureau, which regulates the state’s securities industry, requires all state-registered investment adviser firms to complete an annual written examination. Among other things, the examination seeks information regarding firm organization, business model and investment concentration, as well as information regarding the representatives associated with the firm. Examination responses are used to determine whether a more in-depth examination is necessary, to analyze areas of concern or priority for the Bureau, as well as to monitor the latest trends in the investment advisory field.
“The New Jersey Bureau of Securities is on the front lines in proactively protecting investors. The annual examination process is one of the Bureau’s key gatekeeping tools for identifying trends and risks that can harm investors,” Acting Attorney General John J. Hoffman said.
The Bureau has required all state-registered investment advisers to complete a written examination for more than 15 years. Following passage of the Dodd-Frank Wall Street Reform and Consumer Protection Act, the Bureau’s written examination was modernized and became electronic. The written examination is updated each year to reflect changes in the investment adviser industry and the Bureau’s examination priorities.
“The annual written examination assists the Bureau in identifying and stopping problematic business practices before they can harm investors,” said Steve Lee, Acting Director of the State Division of Consumer Affairs.
New Jersey’s Uniform Securities Act and regulations thereunder permit the Bureau to conduct both routine and for-cause examinations of investment advisers. These examinations can be either announced or unannounced.
“Although the number of New Jersey-registered investment advisers has significantly increased since the financial crisis, effective securities regulation requires frequent industry contact and oversight,” Bureau Chief Laura H. Posner said. “By conducting annual examinations of every state-registered investment adviser, the Bureau is able to effectively analyze advisers’ businesses and create risk profiles in order to protect investors.”
The Bureau’s Examination Unit is headed by Stephen Bouchard, Director of Examinations. The investment adviser examination can be accessed on the Bureau’s website, www.njsecurities.gov, and must be completed by Friday, May 15, 2015.
The Bureau of Securities can be contacted toll-free within New Jersey at 1-866-I-INVEST (1-866-446-8378) or from outside New Jersey at 973-504-3600.