Former SEC Prosecutor
and Wall Street Defense Counsel
The Investment Company Act of 1940, commonly known as the 40 Act, regulates entities that engage primarily in the business of investing, reinvesting, and trading in securities. The most common form of such an investment company is a mutual fund.
The 40 Act is administered and enforced by the Securities and Exchange Commission (SEC). Its primary goal is to ensure that investment companies act in the interest of investors. Its related goal is to minimize conflicts of interest that can arise in the creation, sale, and ongoing administration of securities.Requirements of the 40 Act
Among its various provisions, the 40 Act requires investment companies to:
The 40 Act also requires investment companies to disclose to investors important information relevant to an investment decision, including:
While the 40 Act is designed to project investors, it does not permit the SEC to directly supervise investment decisions or judge the merits of any investments.Common Violations of the 40 Act
Among some of the most common violations of the 40 Act are as follows:
Whistleblowers can play an important role in helping the SEC identify and prosecute violations of the 40 Act or other provisions of federal securities laws. Whistleblowers can, however, experience challenges as cases proceed through the enforcement process, which can often be lengthy and complicated. This requires experienced SEC whistleblower lawyers to provide strategic advice, support, and a watchful eye.
Attorneys Scott Silver and David R. Chase are nationally recognized securities lawyers. They have extensive experience representing SEC whistleblowers.Contact Us
If you think you qualify as a whistleblower for the SEC, contact us at 1-800-975-4345. You can also reach out online.