Question

Under the Investment Advisers Act of 1940, which of the following investment advisers is NOT exempt from federal registration?

A)
All of John's clients reside in his home state, and John offers no advice on any exchange-listed securities. He manages $50 million in assets and none of his clients are private funds.
B)
ABC Advisers, with offices in 4 states, deals exclusively with insurance companies.
C)
Marie maintains her only office in Paris, France, deals with fewer than 15 clients (none of whom is a registered investment company) in private funds advised by Marie, has AUM in the United States of less than $25 million, and does not hold herself out as an investment adviser in the United States.
D)
All of Paula's clients are private funds and she has total assets under management of $200 million with less than $25 million of that belonging to foreign investors.

Answer 1

D) All of Paula's clients are private funds and she has total assets under management of $200 million with less than $25 million of that belonging to foreign investors.

Step-by-step explanation:

The exemptions that came from the SEC registration requirement under the Advisers Act involves advisers who renders no suggestion on any exchange security i.e. listed and the clients are in single state also there is some specific foreign advisors who do not hold as an investment advisiors also they have less than 15 clients per year. So in order to qualfy for the exemption related to the private fund adviser, the total AUM would be lower than $150 million. Also there is an exemption for the investment advisors not considering the no of states where the offices would be maintained.

Therefore, the option d is correct