On May 20, 2009, the US Securities and Exchange Commission (SEC) issued proposed amendments to Rule 206(4)-2 (Custody Rule) under the Investment Advisers Act of 1940 (Advisers Act) aimed at providing additional safeguards for client assets held by registered investment advisers (Proposed Amendments). According to the SEC, the Proposed Amendments are intended to address the findings of several recent high-profile enforcement actions involving certain advisers’ custody arrangements, particularly self-custody or custody of client assets with an affiliate, in which client assets were misappropriated or otherwise fraudulently handled.