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ARTICLE · 30 OCTOBER 2024

When Two Become One: Navigating The Complexities Of Operational Integration

Lowenstein Sandler LLP
Lowenstein Sandler LLP
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Lowenstein Sandler LLP

Lowenstein Sandler LLP

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On September 20, 2024, the U.S. Securities and Exchange Commission (SEC) announced a settlement with an investment adviser for, among other things, failure to register with the SEC as an investment adviser.

United StatesCorporate/Commercial Law
Alex E. Lipton
Alex E. Lipton
Jeremy Cantor
Jeremy Cantor
Scott Moss
Scott Moss

On September 20, 2024, the U.S. Securities and Exchange Commission (SEC) announced a settlement with an investment adviser for, among other things, failure to register with the SEC as an investment adviser. The SEC found that the unregistered investment adviser was "operationally integrated" with its SEC-registered affiliate such that the two entities should have been treated as one for purposes of determining registration requirements.

As shown by this settlement and prior ones, discussed below, this issue continues to be on the SEC's radar. In light of this recent SEC enforcement action, we examine the concept of operational integration and review various related enforcement actions.

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