SEC Provides Guidance on Mutual Fund Prospectus Delivery Obligations

In a guidance letter to certain parties, the SEC Division of Corporation Finance clarified that a broker-dealer may satisfy its prospectus delivery obligation, under Securities Act Section 5(b)(2), by delivering a prospectus to an investment adviser rather than to the adviser's client, provided that the broker-dealer has actual knowledge that the client has granted permission to the adviser to accept the delivery of the prospectus on behalf of the client.