The Investment Advisers Act of 1940 (US, 15 U.S.C. 80b)

Official text

Investment Advisers Act of 1940 (GovInfo compiled statute, 15 U.S.C. §80b)

Status

in force, as amended (the GovInfo compilation is the current consolidated text)

Jurisdiction

United States (federal)

Type

primary law

This page

summary only. The linked Act is the source

The Investment Advisers Act regulates the manager, not the fund. Anyone who, for compensation, is in the business of advising others on securities is an "investment adviser" and is caught. Its spine is registration (§203): with the SEC above an assets-under-management threshold, otherwise at state level. Next to it sits a broad anti-fraud and fiduciary-duty core (§206) that the SEC enforces hard. For private-fund managers the practical questions are the registration route and the exemptions. The private-fund adviser and venture-capital adviser exemptions produce "exempt reporting advisers" who still file. Larger managers register fully. It pairs with the Investment Company Act, which regulates the fund itself.

Scope and the core mechanism

The Act turns on the §202 definition of "investment adviser". It then splits supervision by size: registration with the SEC above the AUM threshold, with the states below it (§203A). Whatever the route, the §206 anti-fraud and fiduciary obligation applies. That is the duty of care and loyalty the SEC reads into the adviser relationship, plus specific rules on custody, advertising and conflicts. Private-fund managers work through the exemptions (private-fund adviser, venture-capital adviser, foreign private adviser). These create the "exempt reporting adviser" category: reduced registration, but still Form ADV filing and the anti-fraud rules. The full section text is searchable clause by clause through the Graph of rules and ask-the-law.

In practice: the exemptions cut your registration burden, not your anti-fraud exposure. §206 and the fiduciary duty reach exempt reporting advisers too. "We're exempt" is not "we're unregulated".