What is legal and illegal in

emailing for hedge funds,

asset managers and wealth
managers?
Paul Das Founder and Managing Director
ProFundCom
Email Marketing specialist in finance
Clients are only Asset Managers, Wealth Managers and Hedge Funds
10 years experience
SEC and FCA compliant
ISO 9001 and SAS 90 certified


Remember

Compliance and controls are always you and your firm's responsibility.
Your firm must have appropriate processes and controls in place.
You can't delegate the responsibility for compliance to another party,
but you can get help to ensure your controls are appropriate.

Legalities around email marketing
or distance marketing
Hedge Funds and Asset Managers - AIFMD
Hedge Funds, Asset Managers and Wealth Managers - FCA and SEC
Hedge Funds, Asset Managers and Wealth Managers ISO 9001
Private Banks and Wealth Managers Social Media regulations
Recorded Webinar here




Compliance Processes and Infrastructure
The following processes and infrastructure must be in place
Data Retention
Archiving
SAS90 and ISO9001 Infrastructure
Document Security
Identity management

Data Retention
SEC and FCA regulations where records of electronic communications are
stored for at least seven years
The types of business include receiving and executing client orders, negotiating,
agreeing and arranging transactions across the equity, bond, financial commodity
and derivatives markets as well as offers of services and products to prospects or
existing investors.
"Electronic communications" subject to the new retention requirements include
faxes, e-mails and instant messaging.

Data is always protected with 256-bit ASE encryption technology.
Files are securely stored at geographically diverse data centers in accordance with SOX
standards.
Data may be restored swiftly and accurately, along with any needed audit information.
Data retention can be set for the specific length of time as mandated by SOX.
Archiving
All emails that have been sent out from the system stored in a special
write-once table, where it remains locked for the SEC regulatory
period of seven years.
These transaction can be queried directly via an interface to provide
immediate regulatory bodies access.


What is Email Marketing according to
AIFMD
A direct or indirect electronic communication of an offering or
placement by a fund manager of a fund it manages to investors based
in the EU
A direct or indirect offering or placement
Does not include news about a fund
Does not include fund performance information
Does not include commentary about a fund but be careful in the narrative
Does include links from an email, tweet or blog posting that go to a website
offerings or placement information
Who can be targeted with offers and
placements
Professional Investors as defined by MIFID
Available at the link below
http://www.fsa.gov.uk/pubs/other/mifid_classification.pdf




Professional clients are considered to possess the experience, knowledge and
expertise to make their own investment decisions and assess the risks inherent in
their decisions. MiFID recognises certain persons as having these qualifications and
automatically classifies them as professional clients.
Who cannot be targeted offers and
placements
Directly or Indirectly you cannot target
Retail Investors
Professional investors that sit outside MIFID
Ultra High Net Worths
High Net Worths
Well informed investors
Sophisticated investors
Ego investors

FCA - The distance marketing rules
Always be transparent in everything you do

A firm must be able to provide a clear and auditable trail of type of investor and the fact that they have
agreed or opted-in to receiving information and that they understand the risks. This needs to be part of the
KYC process.

A firm must ensure that the distance marketing information, the commercial purpose of which must be made
clear, is provided in a clear and comprehensible manner in any way appropriate to the means of distance
communication used, with due regard to the audience.

A firm must not enforce, or seek to enforce, any obligations under a distance contract against a consumer, in
the event of an unsolicited supply of services, the absence of reply not constituting consent.

A firm must communicate to the consumer all the contractual terms and conditions and the information
referred to in the distance marketing disclosure on a durable medium available and accessible to the
consumer in good time before the consumer is bound by any distance contract or offer.
How to protect yourselves
Your mailing lists are at the minimum clearly split into Professional
Investors and non-professional investors.
Provide the ability to have a double opt-in.
Have a process in place to validate existing contacts and non-existing
contacts as professional investors or not.
Compliant email delivery
Unsubscribe
Disclaimer examples available on request
Email archived in a compliant manner


Strategies to market your fund within the
law
Provide thought leadership in communications
Provide industry insight and trends
Provide news worthy element about your strategy
Provide factual information about funds
Provide webinar and event to engage with potential investors
Do not provide an immediate, or direct or indirect call to action
Use deep analytics to track readership with Professional Investors
Who has started reading your communications
What has suddenly started reading after being inactive
Who are the most avid readers
Remember

Compliance and controls are always you and your firm's responsibility.
Your firm must have appropriate processes and controls in place.
Get help to ensure your controls are appropriate.

Thank You
Email questions to
Paul.Das@ProFundCom.net or
Call on +44 (0) 7725 988956