The Michigan Corporations, Securities, and Commercial Licensing Bureau adopted revised regulations for broker-dealers and investment advisers that eliminated the $10,000 surety bond or other security required for broker-dealers with less than $50,000 in net capital.
These broker-dealers only have to meet net capital requirements under the revised regulations. Investment advisers will be required to post a bond if the adviser has custody of or discretionary authority over client funds or securities. The Administrator will determine the bond amount based on the adviser’s number of clients and total assets that are under his or her management.
If an investment adviser fails to meet the minimum net worth requirements and has custody of or discretionary authority over client funds or securities, he or she must post a bond equal to the amount of the net worth deficiency, rounded up to the nearest $5,000.
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