Current through February 27, 2024
1.
Notwithstanding the provisions of section 14, and in addition to any other
recordkeeping requirement, if an investment adviser is registered or required
to be registered under the Investment Advisers Act of 1940 and the investment
adviser is primarily engaged in a business other than advising investment
advisory clients, a record must be maintained of every securities transaction
in which the investment adviser or any advisory representative of the
investment adviser has, or by reason of any transaction acquires, any direct or
indirect beneficial ownership, unless the transaction is:
(a) Effected in any account over which
neither the investment adviser nor any advisory representative of the
investment adviser has any direct or indirect influence or control;
or
(b) A direct obligation of the
United States.
2. The
record described in subsection 1:
(a) Must
include:
(1) The title and amount of the
security involved;
(2) The date and
nature of the transaction, including, without limitation, the purchase, sale or
other acquisition or disposition;
(3) The price at which the transaction was
effected; and
(4) The name of the
broker-dealer or bank with or through whom the transaction was effected;
and
(b) May contain a
statement declaring that the reporting or recording of a transaction described
in this section must not be construed as an admission that the investment
adviser or advisory representative has any direct or indirect beneficial
ownership in the security.
3. The transaction described in subsection 1
must be recorded not later than 10 days after the end of the calendar quarter
in which the transaction was effected.
4. The failure of an investment adviser to
record the transaction of an advisory representative of the investment adviser
shall not be deemed to be a violation of this section if the investment adviser
establishes that the investment adviser instituted adequate procedures and used
reasonable diligence to promptly obtain reports of all transactions required to
be recorded pursuant to this section.
5. As used in this section:
(a) "Advisory representative" means:
(1) A partner, officer, director or employee
of the investment adviser:
(I) Who
participates in any way in the determination of which recommendation must be
made; or
(II) Whose functions or
duties relate to the determination of which securities are being recommended
before the effective dissemination of the recommendations; or
(2) Any of the following persons,
who obtain information concerning securities recommendations being made by the
investment adviser before the effective dissemination of the recommendations or
the information concerning the recommendations:
(I) A person in a control relationship to the
investment adviser;
(II) An
affiliated person of a controlling person; or
(III) An affiliated person of an affiliated
person.
(b)
"Control" means the power to exercise a controlling influence over the
management or policies of a company, unless such power is solely the result of
an official position with the company. Any person who owns beneficially, either
directly or through one or more controlled companies, more than 25 percent of
the voting securities of a company shall be presumed to control the
company.
(c) "Primarily engaged in
a business other than advising investment advisory clients" means when, for
each of the most recent 3 fiscal years of the investment adviser or for the
period of time since organization, whichever is less, the investment adviser
derived, on an unconsolidated basis, more than 50 percent of:
(1) Its total sales and revenues;
and
(2) Its income, or loss, before
income taxes and extraordinary items, from such other
business.
Added
to NAC by Sec'y of State by
R018-21A,
eff. 6/2/2023
NRS
90.390,
90.750
