A mid-sized adviser is a firm with AUM of $25 to $100 million.

A Switch Firm is a mid-sized adviser that will be transitioning from SEC to State registration due to regulatory changes enacted through Dodd-Frank.

Switch Firms can begin applying immediately for Michigan registration.

To apply for Michigan registration, the Switch Firm must update its ADV Part 1 indicating that it is applying for registration in Michigan. When OFIR receives this notification, an email will be sent (to the contact person listed in Web IARD) requesting a copy of all client agreements and a balance sheet. OFIR will conduct a review of the client agreements that are provided. Please know that inconsistencies between the agreements and your firms ADVs are the responsibility of the firm. Approval of your firm does not mean that your documents are approved and free of violations. OFIR will review client agreements simply to ensure that they do not conflict with Michigan law.

Typically, the cost for registration is $200. However, OFIR has decided to waive this fee for Switch Firms that apply for Michigan registration before March 31, 2012.

Switch Firms will not be approved for registration in Michigan until after January 1, 2012, as they are required to remain registered with the SEC until January 1, 2012. Firms must file an amendment to ADV Part 1 between January 1 and March 30, 2012, indicating that they are no longer eligible to remain with the SEC. OFIR will approve firms only after this amendment is completed.

Switch Firms must submit an ADV-W for SEC registration no later than June 28, 2012. Do not submit an ADV-W before being approved in Web IARD by OFIR.

OFIR has a robust examination program and it is our goal to ensure that all Switch Firms are visited within the first 2 years of registration.

By what date do my associated individuals need to register as investment adviser representatives?

If you are required to register as an IAR in Michigan, you must be registered before the firms' SEC registration is withdrawn.

If your Switch Firm is required to register in 4 or more states, you may participate in a coordinated review program coordinated by the North American Securities Administrators Association, Inc. (NASAA). For more details on this program, please refer to NASAA's website found here.

All Switch Firm advisers must have all clients sign an updated contract, complying with Michigan law, no later than January 1, 2013.

Pursuant to Section 411(7) of the Act, MCL 451.2411(7):

• An investment adviser registered or required to be registered under the Act shall furnish each investment advisory client and prospective investment advisory client with:
• a brochure which may be a copy of Part 2A of its Form ADV or written documents containing the information required by Part 2A of Form ADV;
• a copy of its Part 2B brochure supplement for each individual;
• a copy of its Part 2A Appendix 1 wrap fee brochure if the investment adviser sponsors or participates in a wrap fee account; and
• a summary of material changes, which may be included in Form ADV Part 2 or given as a separate document
• The brochure must comply with the language, organizational format, filing and delivery requirements specified in the Instructions to Form ADV Part 2.
• An investment adviser registered or required to be registered under the Act shall complete and make publically available its Form ADV Part 1 disclosure document. The disclosure document must comply with filing and delivery requirements specified in the Form ADV: General Instructions.

All investment adviser firms wishing to directly debit advisory fees from a client’s account must comply with the following:

• The client must provide written authorization permitting the adviser’s fees to be paid directly from the client’s account held by an independent custodian, the frequency of the withdrawal, and the manner in which an objection of the fee shall be made;
• the adviser must send to the client and the custodian at the same time a bill showing the amount of the fee, the value of the client’s assets on which the fee was based, and the specific manner to which the adviser’s fee was calculated;
• the custodian must provide the client, not less than quarterly, a statement indicating all amounts disbursed from the account including, separately, the amount of advisory fees paid; and
• the client must be able to terminate the written billing authorization or agreement at any time