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§ 260.235.2. Disclosure of Compensation for Financial Planning Activities.

10 CA ADC § 260.235.2Barclays Official California Code of Regulations

Barclays California Code of Regulations
Title 10. Investment
Chapter 3. Commissioner of Financial Protection and Innovation (Refs & Annos)
Subchapter 2. Corporate Securities (Refs & Annos)
Article 10. Licensing and Regulation of Investment Advisers
10 CCR § 260.235.2
§ 260.235.2. Disclosure of Compensation for Financial Planning Activities.
Currentness
(a) It shall constitute a fraudulent, deceptive, or manipulative act, practice or course of business within the meaning of Section 25235 of the Code for an investment adviser or an associated person of an investment adviser to fail to deliver to a financial planning client a notice in writing containing at least the information found below at the time of entering into a contract for, or otherwise arranging for the provision of, the delivery of a financial plan:
(1) Whether the investment adviser, or an affiliate or associated person of the investment adviser, will receive commissions from the sale of insurance or real estate or will receive fees or other compensation from the sale of securities or other products or services recommended in the financial plan or otherwise has a conflict of interest. If so, that a conflict exists between the interests of the investment adviser or associated person and the interests of the client. This requirement does not apply to an investment adviser or an associated person of the investment adviser if the investment adviser, an associated person of the investment adviser, and an affiliate of the investment adviser will not receive fees or other compensation from the sale of securities or other products or services recommended in the financial plan, and if such persons otherwise do not have a conflict of interest.
(2) The client is under no obligation to act on the investment adviser's or associated person's recommendation. Moreover, if the client elects to act on any of the recommendations, the client is under no obligation to effect the transaction through the investment adviser or the associated person when such person is employed as an agent with a licensed broker-dealer or is licensed as a broker-dealer or through any associate or affiliate of such person.
(b) “Financial planning” includes, in all or part, but is not limited to, the preparation of a financial plan by an investment adviser or an associated person of an investment adviser for an investment advisory client which may include estate or tax planning recommendations, an annual or periodic review of a financial plan, the management and/or monitoring of a client's investments under a financial plan, the provision of information and/or advice to a client regarding the purchase and/or sale of securities, real estate, insurance contracts, annuities contracts, or any types of real or personal property under a financial plan.
(c) This rule does not apply to persons exempt from the provisions of Section 25230 of the Code by virtue of Sections 25202 and 25203 of the Code and Section 260.204.2 of these rules.
(d) Nothing in this section shall be construed to limit the authority of any state agency, including but not limited to the Departments of Real Estate and Insurance, to regulate persons subject to their jurisdiction.

Credits

Note: Authority cited: Section 25610, Corporations Code. Reference: Section 25235, Corporations Code.
History
1. New section filed 12-20-85; effective thirtieth day thereafter (Register 85, No. 51).
This database is current through 5/3/24 Register 2024, No. 18.
Cal. Admin. Code tit. 10, § 260.235.2, 10 CA ADC § 260.235.2
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