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D.C. Municipal Regulations (Last Updated: September 13, 2017) |
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Title 26. INSURANCE, SECURITIES, AND BANKING |
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SubTilte 26-B. SECURITIES |
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Chapter 26-B1. BROKER-DEALERS, AGENTS, INVESTMENT ADVISERS, AND INVESTMENT ADVISER REPRESENTATIVES |
Section 26-B168. SUPERVISION
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168.1Every investment adviser registered or required to be licensed under the Act shall exercise diligent supervision over the investment advisory activities of its investment adviser representatives and employees.
168.2Each investment adviser representative and other office employees shall be subject to the supervision of a designated principal.
168.3Written procedures, a copy of which shall be kept in each business office, shall be established, maintained, and enforced and shall set forth the standards and procedures adopted to comply with the requirement imposed by the Act and rules promulgated thereunder.
168.4Each office location shall be periodically inspected by the designated supervisor to assure that the written procedures are complied with.
168.5It shall be the responsibility of each investment adviser to ascertain that investment adviser representatives have been properly licensed prior to rendering investment advice.
168.6It shall be the responsibility of each investment adviser and its supervisory personnel to ensure that all employees of such investment adviser are properly trained regarding the disclosure requirements and the civil and criminal liability provisions of the Act.
168.7For the purposes of this section, no person shall be deemed to have failed reasonably to supervise any other person if:
(a)There have been established procedures, and a system for applying such procedures, which would reasonably be expected to prevent and detect, insofar as practicable, any such violation by such other persons; and
(b)Such person has reasonably discharged the duties and obligations incumbent upon such person by reason of such procedures and system without reasonable cause to believe that such procedures were not being complied with.