A letter issued by the SEC following an examination, identifying areas where the adviser's practices do not comply with securities laws or regulations. The adviser must respond in writing, describing the corrective actions taken or planned.
Deficiency letters are not public (unlike enforcement actions) and represent an opportunity to correct issues before they escalate. Most examinations that identify problems result in deficiency letters rather than enforcement proceedings.
This article is for informational purposes only and does not constitute legal advice. Consult qualified professionals for guidance specific to your situation.