SEC Adopts Reforms Relating to Investment Advisers Operating Exclusively Through the Internet

The Securities and Exchange Commission today adopted amendments to the rule permitting certain internet investment advisers to register with the Commission (the “internet adviser exemption”). The amendments will require an investment adviser relying on the internet adviser exemption to have at all times an operational interactive website through which the adviser provides digital investment advisory services on an ongoing basis to more than one client. The amendments will also eliminate the current rule’s de minimis exception by requiring an internet investment adviser to provide advice to all of its clients exclusively through an operational interactive website and to make certain corresponding changes to Form ADV. “These amendments modernize a 22-year-old rule to better protect investors in a digital age,” said SEC Chair Gary Gensler.