Federal Covered Adviser
An adviser registered with the SEC rather than the states.
What is Federal Covered Adviser?
Advisers with more than $110 million of regulatory assets under management must generally register with the SEC; those under $100 million generally cannot (between $100M and $110M, the adviser may choose). Advisers to registered investment companies register with the SEC regardless of size. States cannot require a federal covered adviser to register, but can require a notice filing, a fee, and consent to service of process, and they keep full antifraud authority.
Federal Covered Adviser: a worked example
A $400 million RIA registers with the SEC and notice files in the states where it has offices or more than de minimis clients.
More terms in Uniform Securities Act & Registration
Uniform Securities Act (USA)
The model state securities law most states' 'blue sky' statutes are based on.
State Securities Administrator
The official or agency that enforces a state's securities act.
Person (USA Definition)
Anyone who can be held legally responsible - individuals and organizations.
Investment Adviser (USA Definition)
Advises on securities, as a business, for compensation.
Excluded from the Investment Adviser Definition
Banks, incidental professionals, broker-dealers, and publishers are not advisers at all.
Exemptions from State Adviser Registration
An adviser with no office in the state and only institutional or very few clients there.
De Minimis Exemption
No place of business in the state and fewer than 6 clients there in 12 months.
Exempt Reporting Adviser
A private fund adviser exempt from SEC registration but still filing reports.
All Uniform Securities Act & Registration terms · Full glossary