For Investment Advisers
Not Quite Dead Yet – DOL’s Fiduciary Rule Rises Again! On December 18, 2020, the Department of Labor (DOL) adopted Prohibited Transaction Exemption 2020-02 (“PTE 2020-02”), subjecting 401(k) rollover subject to ERISA’s fiduciary rules (sometimes). The exemption, called Improving Investment Advice for Workers and Retirees, expands the definition of fiduciary advice under ERISA to recommendations about rollovers and IRA investments. So now, in addition to best interest, fiduciary and disclosure standards imposed by the SEC and FINRA, investment advisers, broker-dealers, banks, and insurance companies (“Financial Institutions”) now have to prove compliance with the DOL’s “Impartial Conduct Standards.” Failure to comply can result in substantial penalties.
The exemption went into effect on February 16, 2021, dashing any hopes that President Biden’s administration might revisit or postpone it. But don’t panic if you are not ready. The DOL and the IRS have agreed to extend their non-enforcement policy until December 20, 2021.
For Financial Institutions and their employees, agents, and representatives (“Investment Professionals”) serving retirement investors, this means more disclosure and documentation.
- Who Needs the Exemption
Financial Institutions and Investment Professionals who (a) recommend rollovers to retirement plan participants, and (b) provide advice to IRA owners about how to invest their IRAs.
- Why do we need the exemption?
PTE 2020-02 has a significant impact. It expands the definition of investment advice under ERISA to include a recommendation to a plan participant to roll over his or her assets from the plan to an IRA.
This is HUGE because ERISA fiduciaries are prohibited from engaging in transactions where they receive increased compensation as a result of their advice. Simply put, an adviser cannot receive compensation for advising a plan participant to roll over his or her 401(k) assets into an IRA managed by that adviser, assuming that advice is considered ERISA investment advice (more on that later). Receiving an advisory fee for managing the IRA assets could be a prohibited transaction. Additionally, broker-dealers can be prohibited from advising on 401(k) rollovers if they receive additional compensation such as 12b-1 fees, trailing commissions, sales loads, mark-ups and mark-downs, and revenue sharing payments from mutual funds or third parties.
There are two ways to avoid engaging in a prohibited transaction when giving rollover advice. The first is to avoid being an ERISA fiduciary in the first place. The second is to qualify for a prohibited transaction exemption.
- Are all rollover recommendations considered ERISA fiduciary advice?
No. At the core of this exemption is the DOL’s discussion of how to determine whether you are providing investment advice as an ERISA fiduciary. In prior guidance, the DOL had stated the recommendation to a 401(k) plan participant to roll over assets to an IRA was considered a one-time recommendation, and therefore did not satisfy one of the five hallmarks of an ERISA fiduciary, providing advice on a regular basis. The five-part test defines an ERISA fiduciary as someone who, for a fee, (i) provides investment advice to an ERISA plan, plan fiduciary, plan participant, or IRA owner (ii) on a regular basis (iii) pursuant to a mutual agreement. The advice must (iv) serve as the primary basis for an investment decision, and (v) be individualized based on the particular needs of the plan, plan participant, or IRA owner. In the DOL’s prior guidance, the DOL held that advice to roll assets from a plan to an IRA was not “investment advice” because it was not advice with respect to assets of a plan. Broker-dealers also took the position that advice about 401(k) rollovers was not provided on a “regular basis” and was not provided pursuant to a mutual agreement.
This exemption changes this position. The DOL now holds that advice on whether to take a distribution from a retirement plan and roll it over to an IRA (or to roll over from one plan to another plan, or one IRA to another IRA) may be ERISA investment advice if the advice is either part of an ongoing relationship or the start of an ongoing relationship. For example, if a broker-dealer will be providing advice with respect to the IRA after the rollover, this advice would satisfy the “regular basis” requirement. Moreover, the DOL now interprets “mutual” agreement, arrangement, or understanding about the investment advice as being based on the reasonable understanding of each of the parties. A written agreement is not necessarily required.
- What does the Exemption Require?
The key conditions of the exemption require Financial Institutions and Investment Professionals to:
- Acknowledge that they are fiduciaries under ERISA;
- Disclose, in writing, to the client the scope of the relationship and all material conflicts of interest (similar to Regulation Best Interest’s requirement for broker-dealers);
- Comply with the Impartial Conduct Standards
- Exercise reasonable diligence, care, skill and prudence in making a recommendation, meaning that the firm and its representatives have a reasonable basis to believe that the recommendation being made is in the best interest of the client, based on that client’s investment profile and the potential risks and rewards associated with the recommendation;
- Receive only reasonable compensation (as compared to the marketplace) and seek best execution of the transaction;
- Establish, maintain and enforce written policies and procedures reasonably designed to identify, disclose and mitigate, or eliminate material conflicts of interest arising from financial incentives associated with such recommendations;
- Provide written disclosures to retirement investors of the reasons the rollover recommendation is in their best interest;
- Conduct an annual compliance review and document the results in a written report to a “Senior Executive Officer” of the Financial Institution; and
- Maintain written documentation of the specific reasons that any recommendation to roll over assets from an ERISA plan to an IRA, from one IRA to another IRA, or from one type account to another (such as commission-based account to a fee-based account) is in the best interest of the retirement investor.
This exemption and its requirements are complicated and require more thorough analysis than can be provided here. Check out the articles included in our “Worth Reading, Watching and Hearing” section, and stay tuned for additional blog posts on this topic. Contributed by Jaqueline M. Hummel, Partner and Managing Director.
Regulatory Limbo – Freeze Impacts on RIAs and Investment Companies. The Biden administration issued a memorandum on January 20, 2021 to freeze the proposal and issuance of new rules pending their review and approval by appropriate heads within the Biden team. It also directs department heads to take certain actions to review rules adopted before the memorandum was issued but have not yet taken effect. Technically, the memorandum does not apply to independent agencies, such as the SEC; however, these agencies have the option to adhere voluntarily. Below is a summary of key investment adviser and investment company rules currently caught in the crosshairs of this freeze:
- Advisers Act Marketing Rule – At the time of this newsletter’s publication, the Marketing Rule has not yet been published in the Federal Register. There is a possibility that either the acting or newly appointed SEC Chair may subject the rule to further review before letting it proceed.
- Regarding rules published in the Federal Register that haven’t yet taken effect, the memorandum instructs department heads to consider postponing effective dates for 60 days from the memorandum’s publication. During this time, departments must consider opening a new 30-day comment period and may delay effectiveness further if they identify “substantial questions of fact, law or policy”. Rules impacting Advisers and Investment Companies in this category include:
- SEC Derivatives Rule (Investment Company Act): Scheduled Effective Date February 19, 2021, and Compliance Date August 19, 2022.
- CFTC Speculative Position Limits: Scheduled Effective Date March 15, 2021, and Compliance Dates ranging from January 1, 2022, to January 1, 2023.
- The status of the Department of Labor’s ESG Rule is also unclear. While this rule became effective on January 12, 2021, President Biden could issue an executive order requesting the DOL review this new rule.
Firms affected by these rules should sit tight for now but be aware that some of the same people who dissented to their adoption are now in positions of greater power to influence their trajectory. As a result, there is a possibility for further delays as well as changes. In particular, advisers eager to implement the new Marketing Rule should remember that even after the rule becomes effective, a decision to comply with the rule ahead of the compliance date will require full compliance with all aspects of the rule. Contributed by Cari A. Hopfensperger, Managing Director.
FINRA Publishes 2021 Enforcement Priorities and Exam Findings Report. On February 1, FINRA published the 2021 Report on FINRA’s Examination and Risk Monitoring Program (“Report”). This Report is a change in FINRA’s normal approach as this publication replaces two of their typical annual publications: (1) the Report on Examination Findings and Observations and (2) the Risk Monitoring and Examination Program Priorities Letter. You will find a lot of the same priorities on this year’s Report as we have seen in previous years (i.e., Anti-Money Laundering, Best Execution, Cybersecurity, Private Placements, etc.). Some priorities that we haven’t seen in the last couple of years include: Books & Records; Business Continuity Planning; Consolidated Audit Trail (CAT); Large Trader Reporting; Net Capital; Regulatory Events Reporting; and Variable Annuities.
Not surprisingly, the COVID-19 Pandemic and Regulation Best Interest/Form CRS are playing a significant role in FINRA’s priorities for 2021. Although Communications with the Public is a common priority for FINRA, this year, they will likely be focusing on member firm’s digital communications to determine if they have reasonably designed programs to monitor, supervise, and retain those communications. Members should keep in mind that digital communications may include the use of video conferencing services/platforms like Microsoft Teams and Zoom. Looking for more information on this topic? Check out “The Rise of Slack, Teams, Hangouts, Stride and Other Instant Messaging Apps for the Remote Workforce – Are your Books and Records Practices up for the Challenge?” by Hardin consultant, Theresa Sekely. Contributed by Doug MacKinnon, Senior Compliance Consultant
FINRA Warns of Risks when Engaging in Low-Priced Securities Business. FINRA released Notice 21-03 reminding Members of certain risks associated with transactions in low-priced securities. The Notice provides information on how Members can enhance their controls for detecting, monitoring, and reporting fraudulent activities. Read-up on potential red flags and indicators of fraud involving low-priced securities based on FINRA’s recent observations, including schemes involving COVID-19 claims. Did you know the extent of a Member’s involvement in low-priced securities transactions (including soliciting customers, conducting offerings, and executing transactions in low-priced securities) could place the firm in a higher risk category and encourage FINRA to visit more often? That being said, it might be time for your firm to review its policies and procedures related to low-priced securities. Notice 21-03 and its predecessor, Notice 19-18, are good launching points. Contributed by Rochelle A. Truzzi, Managing Director.
For Commodity Pool Operators
CFTC Amends Form CPO-PQR. In October 2020, the CFTC adopted amendments to CFTC Regulation 4.27 which resulted in changes to its quarterly CPO filing, the CPO-PQR. Namely, the updated form will drop certain schedules and questions; will include a request for filers to provide Legal Entity Identifiers (LEIs) for CPOs and their pools; and will include a uniform reporting schedule which was previously for filers of different AUMs. The CFTC does not require a December 31, 2020 filing; however, the NFA Form PQR is still due on March 31 and will reflect the changes implemented on the CFTC’s parallel form. The NFA added a template for the new form, which can be reviewed on its website: NFA Form PQR. Contributed by Mark L. Silvester, Compliance Associate.
Payment for Order Flow Gets Another Broker into Hot Water for Undisclosed Conflicts. The SEC found Lightspeed Trading, LLC (“Lightspeed”), formerly a registered broker-dealer, guilty of securities fraud for lying to customers and profiting from lower “market center fees” charged by its affiliate for executing trades. In 2012, Lightspeed started offering customers access to an equity trading platform that allowed them to select the exchange or trading venue for executing their orders. Unfortunately, that freedom of choice was an illusion. Lightspeed actually sent many trades to its affiliated Routing Broker, which charged Lightspeed less for the trades than the venues the customers had selected. Lightspeed charged the fees those venues advertised and kept the difference, to the tune of $300,000 over a period of seven months. The SEC required Lightspeed to repay its clients, but the firm pleaded poverty and got $100,000 of its penalty waived.
Advisers and brokers-dealers should start paying attention to the order routing practices of the firms they use to execute trades. The SEC has found a new source of conflicts of interest and will likely start including more questions in its examinations on this topic. Contributed by Jaqueline M. Hummel, Managing Director.
Multiple Disclosure Failures Lead to $18 Million Fine for Wrap Sponsor. We know that transparent disclosure is the name of the game when it comes to wrap accounts. We also know that the SEC has been laser-focused on disclosures of both 12b-1 fees and revenue sharing. A recent SEC administrative order shows us just how bad things can get when these areas aren’t diligently supervised. Pruco Securities, LLC (“Pruco”) recently settled with the SEC for failing to honor its fiduciary duty to its advisory clients that participated in one of its four wrap fee programs. Not only did the SEC find that Pruco was recommending mutual fund share classes to clients that would generate 12b-1 fees for the firm, but Pruco also failed to disclose the revenue sharing agreement it had in place with its clearing firm, which allowed the Pruco to avoid paying certain transaction fees. Pruco received revenue sharing from the same clearing firm for sales of certain bank sweep vehicles that it recommended to clients, which also went undisclosed.
Unfortunately, Pruco fell short in other areas as well. Despite Pruco’s disclosures, policies and procedures outlining periodic monitoring and review of wrap accounts to determine suitability, these procedures were not being performed. Over three years, Pruco generated more than $1.7 million in management fees as a result of maintaining 1,401 wrap fee accounts with little or no trading activity. Pruco also charged management fees contrary to its disclosures, requiring a hefty reimbursement to clients as well as updates to its wrap program brochure. Finally (and perhaps unsurprisingly given the SEC’s findings in other enforcement actions tied to 12b-1 fee), the firm violated its duty to seek best execution by recommending mutual fund share classes that charged higher expenses even though other share classes of the same funds offering a better value or performance were available. As a result of the SEC’s findings, Pruco agreed to pay $18 million in disgorgement, interest and penalties as well as a censure and cease-and-desist.
Not that we necessarily needed reminding, but the intense regulatory scrutiny placed upon the topics of 12b-1 fees, share class selection, and revenue sharing does not appear to be fading anytime soon. There is another important takeaway here, too: firms should have a plan to go beyond that important first step of identifying areas of risk. Firms should allocate appropriate and adequate resources to assess and mitigate those risks, and effective supervision should identify and address an issue before it bleeds into other areas of the firm’s business. The Pruco case is a prime example of just how important this is, and what can go wrong if not properly addressed. Contributed by Jennifer L. Cagadas, Compliance Consultant.
March Madness – RIA Bribed Agents to Recruit NCAA Player Clients. Rosedale Asset Management, LLC f/k/a Princeton Advisory Wealth Management, LLC (“PWM”) agreed to a cease-and-desist order for its participation in a widespread scheme to bribe individuals to influence NCAA amateur athletes to retain PWM as an investment adviser after they turned pro. Between February 2016 and September 2017, PWM made twenty payments totaling more than $96,000 to such individuals. Those referral payments resulted in at least five former NCAA athletes signing advisory agreements with PWM. However, at no time did PWM disclose those referral payments to the prospective clients. This conduct violated Sections 206(1), 206(2), and 206(4) of the Advisers Act and Rule 206(4)-3 thereunder. Contributed by Doug MacKinnon, Senior Compliance Consultant.
Heed the Advice of Your CCO. Advance Practice Advisors, LLC (“APA”) recently agreed to a cease-and-desist order, and its CEO, Paul C. Spitzer, agreed to pay penalties and not to act in a supervisory for allowing an individual not associated with APA to advise APA clients. The unassociated individual happened to be the father of one of its investment adviser representatives (“IAR”).
The IAR had only recently passed his series 7 and series 65 exams when he joined the firm, while his father was rejected by APA because of an ongoing FINRA investigation. Predictably, the father had an existing book of clients willing to move with him, but Spitzer informed him that he was to have ‘no formal affiliation’ with APA. However, the father continued to provide investment advice to clients on an undisclosed basis. Spitzer was responsible for overseeing the new rep and either knew or should have known that the father was servicing APA clients. For example, the father and son shared office space and phone lines, and Spitzer would often discuss topics such as advisory fees with the father. APA and Spitzer did not disclose to clients that the father was not formally associated with APA.
Six months after the hire, a new Chief Compliance Officer joined APA and expressed concerns regarding the office sharing, access to client information, and the lack of disclosures to clients about the relationship. Spitzer did not take any steps to address the CCO’s concerns. Subsequently, the CCO became aware that the son allowed his father to impersonate him on phone calls with APA’s clearing broker and recommended that APA terminate the son’s employment. Again, Spitzer ignored the CCO’s recommendations.
In addition to the lessons regarding the importance of adopting and implementing appropriate supervision policies and procedures, firms that ignore warning signs of blatant policy violations do so at their peril. A noteworthy aspect of this case is that the CCO, who was on record with advice not followed, avoided personal charges or penalties. On December 15, 2020, APA filed a request to terminate its California registration as an investment adviser. Contributed by Jeffrey C. Johnson, Compliance Consultant.
Worth Reading, Watching, and Hearing
- Certain Small Broker-Dealers Have an Additional 30 Days to File their Audited Financials. Small broker-dealers looking for more time to file their annual audit will be interested in this recent blog post from Hardin’s Rochelle Truzzi and link directly to FINRA Regulatory Notice 21-05.
- Be Wary of Requests for Personal Information on Social Media. A quick read but valuable reminder, Robinson + Cole’s Data Privacy and Cybersecurity Insider blog highlights the risks of sharing personal details on social media sites.
- Congress Wants to Talk About GameStop. Matt Levine of Bloomberg has posted multiple updates on the topic of GameStop. In this installment, Mr. Levine takes a critical look.
- LIBOR Replacement Update and self-assessment checklist from OCC. Shearman & Sterling summarizes the LIBOR transition timeline and shares details regarding the new self-assessment checklist released by the OCC.
- Momentum picks up for state-level best interest rule on annuity sales. In state news, Mark Schoeff, Jr. of Investment News, reports on new annuity-related best interest rules in Michigan and Arkansas. They have joined Iowa, Arizona and Rhode Island to become the fourth and fifth states to adopt best interest rules for annuity products.
- State Privacy Bills Reemerge as Momentum Grows Nationwide. Kelley Dryer blog post takes a look at three new state privacy laws and the increasing discussion surrounding the case for a federal privacy standard.
- Comparison of SEC’s Regulation Best Interest and DOL’s Final Investment Advice Class Exemption. Morgan Lewis put together this excellent chart comparing the two sets of requirements.
- DOL’s Fiduciary Interpretation and Exemption: Impact on Rollover Recommendations. Expert advice from Fred Reish and Bruce Ashton and Faegre Drinker.
- DOL Finalized New Prohibited Transaction Exemption for “Investment Advice, with Statement That Fiduciary Standard May apply to IRA Rollover Guidance. Proskauer blog post explains the DOL’s new PTE 2020-02 simply and concisely.
Filing Deadlines and To-Do List for March 2021
- Form ADV Annual Updating Amendment: Existing registered advisers must update and file an amended Form ADV within 90 days of their fiscal year-end (Forms 1A and 2A). The filing fee must be deposited into the adviser’s IARD account before the filing can be submitted. The due date for 2021 is March 31, 2021. Check out the Form ADV quick reference guide here.
- IARD Fees: SEC-registered advisers and exempt reporting advisers are required to pay IARD fees before the submission of the Form ADV annual amendment (by March 31, 2021).
- State Filings: A registered investment adviser and an exempt reporting adviser may be required to make a state notice filing in any state in which an adviser has a specified number of clients, called “Notice Filings.” Notice filings may be made on Form ADV by checking the relevant box in Part 1A and depositing the appropriate state fees into the adviser’s IARD account. Exempt reporting advisers may also be required to register as an investment adviser in some states. Notice filing and investment adviser registration requirements differ from state to state. Each adviser should check the requirements for any relevant state in which it operates or has clients. The due date is within 90 days of the adviser’s fiscal year-end on March 31, 2021.
HEDGE/PRIVATE FUND ADVISERS
- Reaffirm CPO and CTA Exemptions: Firms that claim exemptions from Commodity Pool Operator (“CPO”) registration under CFTC Rule 4.5 or CTFC Regulation 4.13(a)(3) (the “de minimis exemption”), or Rules 4.13(a)(1), 4.13(a)(2), 4.13(a)(5), and firms that claimed an exemption from Commodity Trading Adviser (“CTA”) registration pursuant to CFTC Rule 4.14(a)(8) must re-affirm those exemptions annually within 60 days of the calendar year-end – by March 1, 2021. Notice to Members I-20-43 and Notice to Members I-21-02 contain guidance related to this annual affirmation process.
Reminder: Firms taking advantage of Rule 4.13(a)(3) CPO exemption must now represent for the annual affirmation that neither the person making the filing nor any of its principals are subject to any statutory disqualification included in Section 8a(2) of the Commodity Exchange Act, as amended (the “CEA”) (each a “Covered Statutory Disqualification”). See Hardin’s September 2020 Compliance Informer for details.
- Form PF for Large Hedge Fund Advisers. Large Fund Advisers must file Form PF with the SEC on the IARD system within 60 days of each fiscal quarter-end. For funds with a December 31 fiscal quarter end, Form PF is due March 1, 2021.
- Blue Sky Filings (Form D). Advisers to private funds should review fund blue sky filings and determine whether any amended or new filings are necessary. Generally, most states require a notice filing (“blue sky filing”) within 15 days of the first sale of interests in a fund, but state laws vary. Did you know that Hardin Compliance Consulting offers a convenient and economical blue sky filing service to help firms manage this complicated monthly task? Learn more here and give us a call to discuss your needs further. Due March 15, 2021.
- Exempt Reporting Advisers Form ADV Filing: Exempt Reporting Advisers (i.e., exempt private funds advisers and venture capital advisers) need to update Form ADV Part 1A within 90 days of the adviser’s fiscal year-end on March 31, 2021.
- Annual Reports for 4.7 Exempt CPOs: Exempt CPOs must electronically file audited annual reports, including statements of financial condition, statements of operations, and appropriate footnotes, for their pools with the NFA and distribute them to their investors by March 31, 2021.
- Annual Reports for the Fiscal Year-End December 31, 2020: FINRA requires that member firms submit their annual reports in electronic form. Firms must also file the report at the regional office of the SEC in which the firm has its principal place of business and the SEC’s principal office in Washington, DC. Firms registered in Arizona, Hawaii, Louisiana, or New Hampshire may have additional filing requirements. Due March 1, 2021.
- Supplemental Inventory Schedule (“SIS”): For the month ending January 31, 2021. The SIS must be filed by a firm that is required to file FOCUS Report Part II, FOCUS Report Part IIA or FOGS Report Part I, with inventory positions as of the end of the FOCUS or FOGS reporting period, unless the firm has (1) a minimum dollar net capital or liquid capital requirement of less than $100,000; or (2) inventory positions consisting only of money market mutual funds. A firm with inventory positions consisting only of money market mutual funds must affirmatively indicate through the eFOCUS system that no SIS filing is required for the reporting period. Due March 1, 2021.
- SIPC-6 Assessment: For firms with a Fiscal Year-End of July 31. SIPC members are required to file for the first half of the fiscal year a SIPC-6 General Assessment Payment Form together with the assessment owed within 30 days after the period covered. Due March 1, 2021.
- SIPC-7 Assessment: For firms with a Fiscal Year-End of December 31st. SIPC members are required to file the SIPC-7 General Assessment Reconciliation Form, together with the assessment owed (less any assessment paid with the SIPC-6) within 60 days after the Fiscal Year-End. Due March 1, 2021.
- SIPC-3 Certification of Exclusion from Membership: For firms with a Fiscal Year-End of January 31 AND claiming an exclusion from SIPC Membership under Section 78ccc(a)(2)(A) of the Securities Investor Protection Act of 1970. This annual filing is due within 30 days of the beginning of each fiscal year. Due March 1, 2021.
- Rule 17a-5 Monthly and Fifth FOCUS Part II/IIA Filings: For the period ending February 28, 2021. For firms required to submit monthly FOCUS filings and those firms whose fiscal year-end is a date other than a calendar quarter. Due March 23, 2021.
- Supplemental Inventory Schedule (“SIS”): For the month ending February 28, 2021. The SIS must be filed by a firm that is required to file FOCUS Report Part II, FOCUS Report Part IIA or FOGS Report Part I, with inventory positions as of the end of the FOCUS or FOGS reporting period, unless the firm has (1) a minimum dollar net capital or liquid capital requirement of less than $100,000; or (2) inventory positions consisting only of money market mutual funds. A firm with inventory positions consisting only of money market mutual funds must affirmatively indicate through the eFOCUS system that no SIS filing is required for the reporting period. Due March 26, 2021.
- SIPC-6 Assessment: For firms with a Fiscal Year-End of August 31. SIPC members are required to file for the first half of the fiscal year a SIPC-6 General Assessment Payment Form together with the assessment owed within 30 days after the period covered. Due March 30, 2021.
- SIPC-3 Certification of Exclusion from Membership: For firms with a Fiscal Year-End of February 28 AND claiming an exclusion from SIPC Membership under Section 78ccc(a)(2)(A) of the Securities Investor Protection Act of 1970. This annual filing is due within 30 days of the beginning of each fiscal year. Due March 31, 2021.
REGISTERED COMMODITY POOL OPERATORS
- Form CPO-PQR (All Schedules): Large Commodity Pool Operators are required to file Form CPO-PQR annually with the NFA by March 1, 2021.
- CFTC Form CPO-PQR Schedule A must be filed by small CPOs (i.e., CPOs with less than $150 million in aggregated gross pool AUM as of the close of business on any business day during a calendar year), by March 31, 2021.
- CFTC Form CPO-PQR Schedules A and B must be filed by mid-sized CPOs (at least $150 million to $1.5 billion in aggregated gross pool AUM as of the close of business on any business day during a calendar year) by March 31, 2021.
- CPO Members must distribute an Annual Report, certified by an independent public accountant, to pool participants within 90 days of the pool’s fiscal year-end. CPOs are also required to file this report electronically with NFA using EasyFile. The filing must be made by March 31, 2021.
- Form N-PORT. Funds with a fiscal quarter end of December 31 must file Form N-PORT reporting month end information for each month-end in each fiscal quarter no later than 60 days after fiscal quarter-end. Due date is March 1, 2021. Funds must also prepare the information reported on Form N-PORT within 30 days after every month-end and retain these records, which are subject to SEC inspection.
- Form N-MFP. Form N-MFP (Monthly Schedule of Portfolio Holdings of Money Market Funds) reports information about the fund’s holdings as of the last business day of the prior calendar month and must be filed no later than the fifth business day of each calendar month. Due date is March 5, 2021.
- Form N-CEN. Form N-CEN reports should be filed no later than 75 days after a registered investment company’s fiscal year-end. For funds with a December 31 fiscal year-end, the due date is March 16, 2021. Note: This due date applies to all funds, except for unit investment trusts, whose Form N-CEN reports are due no later than 75 days of the calendar year-end.
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