A US-based SEC-registered investment advisor and technology company engaged InnReg to manage its compliance program, complete remediation following a regulatory examination, and provide an outsourced Chief Compliance Officer.
The client operates an investment management platform built for financial advisory firms. Its technology connects investor assessments, personalized portfolio proposals, model management, tax-aware trading, and client communications.
The firm primarily operates as a subadvisor. Financial advisors maintain the main relationship with investors and determine which strategies are suitable, while the client supports portfolio construction, investment models, trade implementation, and ongoing portfolio management.
The company is institutionally backed and manages more than $1 billion in assets through its platform.
Objective
The client engaged InnReg to take over its RIA compliance program following an SEC examination. Although the firm had addressed several findings, corrective actions remained open across regulatory disclosures, marketing, books and records, personal trading, and written policies.
The client wanted a compliance partner that could manage recurring responsibilities while working closely with its investment, product, operations, security, and people teams.
The engagement was designed to help the client:
Complete and document the remaining SEC examination remediation
Clarify responsibilities among the platform, financial advisor clients, and end clients
Update Form ADV, the Compliance Manual, and the Code of Ethics
Establish recurring reviews for personal trading, communications, marketing, vendors, and client records
Review product, portfolio, and trading workflows as they changed
Support new services and business changes with ongoing compliance analysis
InnReg also needed to fit compliance reviews into the client’s existing product-development and project-management processes while moving selected compliance activities into Regly.
Read our RIA Compliance Checklist for SEC Investment Advisors →
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Challenges
The client’s role as both an investment advisor and a technology platform created compliance questions that extended beyond a standard subadvisor relationship. Its main challenges included:
Finish SEC examination remediation. The examination identified issues involving disclosures, marketing, books and records, personal trading, and written policies. The firm needed to complete the remaining corrective actions and retain evidence showing how each item had been addressed.
Clarify responsibility for end clients. The client did not have direct contracts with the investors whose assets it managed, but the SEC expected those investors to be treated as advisory clients within the compliance framework. Form ADV, agreements, account reviews, and disclosure-delivery processes needed to reflect that position.
Document decisions made through the platform. The client’s assessment and recommendation engine could generate portfolio allocations that financial advisors could accept or change. Records needed to show the relevant inputs, the advisor’s approval, the final instructions, and what the platform implemented.
Strengthen personal trading controls. The firm treated its personnel as access persons subject to holdings, transaction-reporting, and acknowledgment requirements. Historical gaps required review, and the ongoing process needed clearer reminders, escalation steps, and evidence of CCO review.
Review marketing claims and conflicts. Statements involving investment performance, ESG data, proprietary scoring methods, testimonials, and other product claims required supporting records and appropriate disclosures. The client also needed to address conflicts related to ownership and relationships with affiliated financial firms.
Keep the program current as the business changed. The client was adding employees, vendors, communication tools, trading capabilities, and new service lines. Each change could affect policies, disclosures, filings, supervision, or recordkeeping.
InnReg's Solution
InnReg combined outsourced compliance leadership with hands-on program management tailored to the client’s subadvisory model and technology platform. The engagement included:
Providing an outsourced CCO and compliance team. InnReg assumed responsibility for managing the RIA compliance program, maintaining the compliance calendar, leading recurring reviews, and coordinating with the client’s internal teams.
Managing the SEC examination remediation plan. InnReg organized the remaining findings into corrective actions, assigned owners, identified evidence requirements, and tracked deadlines. The work covered regulatory disclosures, client classifications, books and records, conflicts, marketing claims, personal trading, and delivery of disclosure documents.
Updating the compliance framework. InnReg rewrote the Compliance Manual, revised the Code of Ethics, and updated procedures involving advertising, social media, complaints, vendors, information security, whistleblowing, business continuity, and employee onboarding.
Improving personal trading oversight. The firm implemented Regly for Code of Ethics forms, holdings reports, and quarterly transaction reports. InnReg reviewed submissions, followed up on missing reports, documented late filings, and established escalation procedures for overdue items.
Reviewing product and trading workflows. InnReg examined how investor assessments produced portfolio recommendations and how financial advisors approved or changed them. Reviews also covered bulk portfolio changes, tax budgets, model selection, trade instructions, fee testing, best execution, trade errors, and ESG scoring.
Managing recurring compliance reviews. InnReg handled reviews involving advertising, website content, social media, archived communications, complaints, client files, personnel, continuing education, vendors, access privileges, fees, trading, books and records, business continuity, and information security.
Maintaining regulatory disclosures and filings. InnReg supported annual and interim Form ADV amendments, Form CRS updates, state notice requirements, ownership disclosures, conflicts, and other material business changes.
Reviewing new services and systems. As the client expanded, InnReg analyzed new trading and investment-management services, referral arrangements, communication tools, third-party relationships, and internally developed portfolio-management technology.
Client Results
Within the first year of the engagement, the client closed all corrective actions that remained from its SEC examination. The completed remediation addressed regulatory disclosures, personal trading, written policies, marketing procedures, financial records, and the delivery of disclosure documents to end clients.
The client established a rewritten Compliance Manual, a revised Code of Ethics, a working personal-trading reporting process, and clearer records supporting recurring compliance reviews. Its annual compliance review reported no material compliance violations during the review period, and outstanding personal-trading reports were resolved.
The compliance framework also kept pace with changes to the client’s business. Updated regulatory disclosures addressed new trading and investment-management services while documenting the responsibilities of the platform and each primary financial advisor.
During the engagement, the client expanded its team, developed new portfolio and trading capabilities, and grew to manage more than $1 billion in assets. InnReg provided a single point of compliance leadership and a structured process for handling recurring reviews, product questions, filings, and regulatory documentation during this period of growth.
How Can InnReg Help?
InnReg can help RIAs address regulatory disclosures and develop compliance frameworks that keeps pace with their complex business model. If you need help managing recurring compliance reviews or managing disclosures and filings, fill the form below to get in touch.
