November 17, 2010
My firm represents many clients who maintain family offices. We generally support Proposed Rule 202(a)(11)(G)-1's exclusion of family offices from classification as "investment advisors" under the Investment Advisers Act of 1940 and specifically endorse the comments on the proposed rule submitted on behalf of the Private Investor Coalition, Inc. by Perkins Coie on November 11, 2010.
In addition, we suggest that the "sole benefit" aspect of the definition of "family client" be modified so as not to disqualify a trust containing a power of appointment that would permit a family member to appoint trust property to a person who is not a family client until such a power is actually exercised in that fashion. As the Perkins Coie comment points out, many family offices work with trusts formed long ago that cannot be amended and there is no reason to not extend the exclusion to any trust merely because it could in the future benefit persons who are not family clients.
Thank you for considering my comments and the others that have been submitted.