July 22, 2009
As a member of the FPA and a registered investment adviser with the SEC, I am opposed to the requirement in the proposed amendments to the custody rule that would subject investment advisers to a surprise audit by an accounting firm. I do not believe the proposed surprise audit would be an effective regulatory response to the recent scandals in this industry. However, I do believe the proposed surprise audit would put undue burden on smaller SEC-registered investment advisers. In my opinion, this is as a result of recent scandals that had nothing to do with an advisors ability to deduct fees from a clients account. In order to enhance consumer protection, I would aggressively support Congress appropriating additional resources to the SEC to hire and train additional examination staff to increase the regular audit cycle of investment advisers.
Thank you!
Jonathan Scharlau, CFA
SilverOak Wealth Management LLC