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Press Release


For Immediate Release:
May 8, 2017

Office of The Attorney General
Christopher S. Porrino, Attorney General

Division of Consumer Affairs
Steve C. Lee, Director

Bureau of Securities
Christopher W. Gerold, Bureau Chief
  For Further Information and Media Inquiries:
Lisa Coryell, 973-504-6327
C. John Schoonejongen, 973-504-6327

New Jersey Bureau of Securities Announces Annual Examination of Investment Advisers is Underway


NEWARK - The New Jersey Bureau of Securities today announced its annual examination is underway. The Bureau, which regulates New Jersey's securities industry, uses the online survey to oversee the more than 900 investment adviser firms registered with the Bureau. The examination seeks information regarding firm organization, business model and investment concentration, as well as information regarding the representatives associated with the firm.

The Bureau analyzes the responses to determine whether to conduct a more in-depth examination and to identify areas of concern or priority.

"Investor protection begins with prevention and the annual exam allows the Bureau to identify and address problematic business practices before investors are harmed," said Attorney General Christopher S. Porrino. "The exam is a critical component of the Bureau's comprehensive oversight of the financial services industry."

New Jersey's Uniform Securities Act and related regulations permit the Bureau to conduct both routine and for-cause examinations of investment advisers, as well as broker-dealers.  These examinations can be either announced or unannounced. 

Firms are required to provide responses to questions about their business activities, including portfolio composition, compliance with regulatory requirements, and customer complaints. The questions are updated each year to reflect changes in the investment adviser industry and the Bureau's examination priorities.  

"The information collected in the annual examination allows the Bureau to create risk profiles and ramp up oversight when necessary to protect investors," said Steve Lee, Director of the New Jersey Division of Consumer Affairs. "The information also helps the Bureau identify industry trends as they are emerging and assess the risks they may pose to investors."

One of the emerging trends emerging in 2017 is electronic investment advice. For the first time, firms are being queried about advice offered through so-called "robo-advisors."

"The increase in financial technology and automation has made robo-advising a hot issue nationwide," said Bureau Chief Christopher W. Gerold. "Our exam this year will indicate how prevalent automated investment advice is in New Jersey, how it's being used, and what kind of risks it may have to investors in our state."

The investment adviser examination can be accessed on the Bureau's website at www.NJSecurities.gov, and must be completed by May 18, 2017.

The Bureau is charged with protecting investors from investment fraud and regulating the securities industry in New Jersey. It is critical that investors "Check Before You Invest." Investors can obtain information, including the registration status and disciplinary history, of any financial professional doing business to or from New Jersey, by contracting the Bureau toll-free within New Jersey at 1-866-I-INVEST (1-866-446-8378) or from outside New Jersey at 973-504-3600, or by visiting the Bureau's website. Investors can also contact the Bureau for assistance or to raise issues or complaints about New Jersey-based financial professionals or investments.

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Last Modified: 5/8/2017 10:36 AM