NASAA Series 63Regulation of Investment Advisers and IARsEasy
A state securities Administrator reviewing a newly filed Form ADV notes that the firm's compliance manual designates a specific officer who is responsible for administering the firm's written supervisory and compliance policies, including recordkeeping and fiduciary obligations. This officer's role is best described as the firm's:
- ASolicitor
- BQualified custodian
- CChief Compliance Officer
- DRegistered agent for service of process
Show answer & explanationAnswer & explanation
Correct answer: C. Chief Compliance Officer
Investment advisers are required to designate a Chief Compliance Officer (CCO) who is responsible for administering the firm's compliance program, including supervision, recordkeeping, and adherence to fiduciary duties.
Why the other options are wrong
- A. A solicitor refers clients for a fee and has no compliance oversight role.
- B. A qualified custodian holds client assets; it does not administer internal compliance policy.
- D. A registered agent accepts legal service of process, unrelated to compliance oversight.
Chief Compliance Officer (CCO)
An officer designated by an investment adviser to implement and enforce the firm's written compliance policies and procedures.
- Required for both state-registered and federal covered advisers
- Oversees adherence to recordkeeping, fiduciary duty, and regulatory rules
- Distinct from a solicitor or registered agent
Memory trick: CCO = Compliance Captain Onboard