§ 23-19-4-13 — Third party solicitor; required written disclosures; restrictions; exemptions

Indiana § 23-19-4-13

• Jurisdiction: Indiana
• Title 23: BUSINESS AND OTHER ASSOCIATIONS
• Art. 19: INDIANA UNIFORM SECURITIES ACT
• Ch. 4: Broker-Dealers, Agents, Investment Advisers,

Text

(a) For purposes of this section, "adviser"
refers to any of the following:
(1) An investment adviser.
(2) A federal covered investment adviser.
(3) An investment adviser representative.
(b) A third party solicitor shall provide a copy of the third party
solicitor's written disclosure document to a client at the time a
solicitation is made.
(c) A third party solicitor's written disclosure document must
include the following:
(1) The names of the third party solicitor and the adviser who
have entered into an agreement for solicitation services.
(2) The nature of the relationship between the third party solicitor
and the adviser, including any affiliation.
(3) A statement that the adviser will compensate the third party
solicitor for solicitation services.
(4) A statement that the adviser will charge the client for:
(A) the solicitation services; and
(B) the adviser's fee.
(5) The amount of any difference in the adviser's fee if:
(A) the client is charged an adviser's fee that is greater than the
adviser's fee charged to other clients; and
(B) the difference is attributable to the third party solicitor and
the adviser's arrangement for solicitation services.
(d) Except as provided in subsection (e), an adviser who is
employed by or associated with an investment adviser shall not,
directly or indirectly, compensate a third party solicitor for solicitation
services performed in Indiana.
(e) An adviser may compensate a third party solicitor for solicitation
services performed in Indiana if all of the following apply:
(1) The adviser is properly registered with the division or
exempted from registration under this article.
(2) The adviser receives from the client, before entering into an
investment advisory contract, a signed and dated acknowledgment
that the client received:
(A) a Form ADV Part II, or any successor brochure form
required to be filed under:
(i) 17 CFR 203-1(a); or
(ii) rules promulgated under this article; or
a written disclosure statement including all the information
required by a Form ADV Part II; and
(B) the third party solicitor's written disclosure document.
(3) The adviser makes a good faith effort to ascertain whether the
third party solicitor complies with the written agreement.
(4) The adviser has a reasonable basis for believing that the third
party solicitor has complied with the written agreement.
(5) The third party solicitor is compensated under a written
agreement that the adviser is a party to.
(6) The third party solicitor is not the subject of an order listed by
IC 23-19-4-12(d)(5).
(7) The adviser and the third party solicitor have entered into a
written agreement that:
(A) describes the third party solicitor's:
(i) services on behalf of the adviser; and
(ii) compensation for the services;
(B) contains the third party solicitor's agreement to perform the
third party solicitor's duties consistent with:
(i) the adviser's instructions; and
(ii) this article; and
(C) requires the third party solicitor, when performing
solicitation services described in the agreement, to provide the
client with:
(i) a current copy of the adviser's Form ADV Part II, or any
successor form; and
(ii) a copy of the third party solicitor's written disclosure
document.
(f) This section does not relieve an adviser of any fiduciary or other
obligations under any law.

Legislative History

As added by P.L.158-2022, SEC.6.