RIA and Custody.. among other things.

GWillis's picture
Rank: Baboon | 148

Hey everyone,

Not long ago I started my own RIA and things have been going fairly well. I had a couple questions I was hoping some others who may have their own RIA could answer.

  1. My LLC is set up in Delaware, but I've come across regulations called the "Foreign LLC Requirements" which basically say if you conduct business in a state other than your LLC registered state you need to file as a foreign LLC. This seems kind of odd to me since as an IA I've already paid filing fees in these states to conduct IA business, but now I also need to register my LLC in the state too? Anyone have info on that?
  2. On item 9 for Form ADV I put down I didn't have custody of client assets in their custodial accounts. Mainly because I can't write checks in their names, move funds to other accounts or bank accounts, essentially I can only ask the custodian to deduct fees to meet whatever is owed to my firm. Apparently though the mere fact I have access to client accounts I have custody in the eyes of my state regulator. I find that odd because I know plenty of firms put "No" on item 9 even though that's exactly what they're doing too. Anyone have info on that?

Comments (3)

Jan 30, 2020

this ain't the place for these questions. you need an attorney and a CPA to sort this out.

Jan 30, 2020

I've asked my regulators and a few accountants I know and they have no clue. Seems to me the IA fee covers things. I'll reach out to an attorney anyway though.

Feb 16, 2020
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