§ 25234 Investment Advisory Contract Requirements
This law tells investment advisers in the state that they can't charge fees based on a share of a client’s profits, must get the client’s okay before they hand the contract to someone else, and must tell the client if the adviser’s partnership members change.
A financial adviser promises to manage a client’s portfolio and says they will earn 20% of any profit the client makes. The adviser also plans to sell the contract to another firm without telling the client and later adds a new partner to the advisory firm without notifying the client.
Under this law, the adviser cannot charge a fee that is a piece of the client’s gains, must include a clause that says they need the client’s permission before assigning the contract, and must inform the client promptly if a new partner joins the advisory firm.
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§ 25234 Investment Advisory Contract Requirements
Last verified: January 10, 2026