Compliance Services

Compliance Services 2019-02-04T16:22:09+00:00

The compliance requirements and challenges for registered investment vehicles has grown increasingly complex since the implementation of Rule 38a-1 of the Investment Company Act of 1940 (“1940 Act”).

To ensure that they meet today’s stringent compliance requirements, all registered funds are required to have a Chief Compliance Officer (CCO). Gemini, via our sister firm, Northern Lights Compliance Services, LLC (NLCS), provides an experienced, qualified person to act on an independent basis as your fund’s CCO. In that capacity, your NLCS compliance officer will report directly and only to your fund’s board of directors/trustees. Our staff includes attorneys, former regulators, former CPAs/auditors, former CCOs, and operations professionals who are proficient in fund compliance requirements. This diverse experience enables us to evaluate the steady stream of new regulations from many different perspectives, resulting in practical and cost-effective implementation strategies.

For fund managers who register their funds in a Gemini-sponsored series trust, NLCS will provide the required CCO. Those who operate a standalone fund with Gemini may also utilize NLCS for their fund CCO needs.

We offer comprehensive compliance services for investment companies and compliance consulting and support services to Registered Investment Advisors (RIAs).

Investment Fund Services: Named CCO

Through NLCS, our goal is to help ensure that registered funds meet the SEC’s stringent regulatory compliance requirements. We assist funds in complying with the federal securities laws (defined by Rule 38a- l) and meeting the responsibilities as outlined by Rule 38a-1 under the 1940 Act, as amended. Our broad program is tailored to meet the needs of small- to medium-sized funds that are seeking a cost-effective alternative to hiring a CCO on a full-time basis. We will provide an experienced, qualified, and independent person to act as the fund CCO.

As the fund’s named CCO, we provide the following services:

  • Evaluation of internal control structures and operations of the various service providers to ensure current practices are compliant with the latest changes in federal securities laws and rules
  • Development and implementation of fund policies and procedures; we review and assess the effectiveness based on regulatory and operational changes at least annually or as changes occur
  • Review of policies and procedures of the fund’s service providers, including the investment advisor, underwriter, administrator, accounting, and transfer agent, and any subsequent changes as they are proposed and implemented
  • Annual assessment of compliance with and effectiveness of the fund’s compliance program
  • Oversight of the fund’s service providers’ compliance programs, including site visits
  • Review of administrator-prepared reports for regulatory and prospectus compliance
  • Review of regulatory filings from a compliance perspective
  • Participation in fair valuation committee meetings
  • Participation in regulatory examinations, as appropriate
  • Attendance at quarterly board meetings in person or via telephone, providing quarterly compliance updates of our activities
  • Preparation of a written annual compliance report to the fund’s board of directors/trustees addressing:
    • the operation of the policies and procedures of the fund and its service providers, as well as any material changes made to those policies and procedures since the date of the last report
    • any material changes to the policies and procedures recommended as a result of the annual review
    • any “material compliance matter” as defined in Rule 38a- I of the 1940 Act

Registered Investment Advisor (RIA) Services: CCO Support

Through NLCS, we can help RIAs keep pace with the rapidly-changing compliance environment by offering a full complement of compliance services. We collaborate with your firm’s management to identify regulatory challenges and then build and implement customized practical solutions designed to meet your firm’s regulatory responsibilities.

We work directly with your managing principal or chief compliance officer to identify registration challenges and then build and implement solutions to meet regulatory responsibilities. We can relieve the burden of finding competent personnel by performing these functions for you.

Compliance with advertising regulations in the investment advisory industry is a challenge for any company since most of the rules are not specific or clear. The cost of not meeting this challenge could be sizable fines or a damaged reputation. With our advertising review service, we partner with your team to ensure all advertising and marketing is reviewed thoroughly and efficiently.

As the financial services industry continues to evolve and become more complex, it is essential that every advisory firm has properly-trained compliance professionals in place to protect them from regulatory scrutiny. It is often challenging to find quality training curriculum to keep compliance personnel up to date on the latest regulatory requirements. NLCS can train compliance staff on the responsibilities associated with their particular compliance duties or provide guidance on an as-needed basis.

Investment advisor CCO general support services are also offered and include assisting in:

  • Updating the compliance manual, code of ethics and other documentation supporting the compliance program
  • Testing, such as reviews of:
    • Required submissions under the code of ethics
    • Timeliness of regulatory filings
    • Compliance with portfolio holdings dissemination policy
    • NAVs with unusual changes
    • Results of sales back-testing
    • Best execution
    • Email
  • Review of compliance programs of the advisor and sub-advisor(s), including site visits
  • Completion of annual compliance review as required under section 206(4)-7 of the Investment Advisors Act, as amended
  • Completion of risk assessment matrix
  • Review of cybersecurity-related policies and procedures

Additional Services

NLCS provides the following additional ad hoc compliance services that you can purchase as the need arises:

We offer a cybersecurity solution to assist financial professionals in upholding their fiduciary duty to clients and investors by adequately overseeing and addressing cybersecurity risks.

Through NLCS, we can provide assistance with a firm’s annual 206(4)-7 risk assessment and compliance review.

We can conduct a mock SEC examination of an investment advisor. We will visit the firm, conduct interviews with key personnel and principals, review a sampling of the investment advisory documents the SEC would likely request, and prepare a written report of our findings.

The compliance environment is rapidly changing. Help your firm keep pace.

We collaborate with your firm’s management to address the steady stream of new regulations from many different perspectives to build and implement practical solutions designed to meet your firm’s regulatory responsibilities.

Let’s Talk

Contact a member of our team.