---
kind: "section"
citation: "15 U.S.C. § 80b–6"
title: "15"
title_heading: "Commerce and Trade"
number: "80b–6"
heading: "Prohibited transactions by investment advisers"
release: "119-102"
url: "https://uscodex.org/usc/15/80b-6"
units:
  - "Chapter 2D — Investment Companies and Advisers"
  - "Subchapter II — Investment Advisers"
---

# §80b–6. Prohibited transactions by investment advisers


It shall be unlawful for any [investment adviser](/usc/15/6102.md?p=d-2-B-ii) by use of the mails or any [means or instrumentality of interstate commerce](/usc/15/80b–2.md?p=a-14), directly or indirectly—

- (1) to employ any device, scheme, or artifice to defraud any [client](/usc/15/80b–11.md?p=a) or prospective [client](/usc/15/80b–11.md?p=a);
- (2) to engage in any transaction, practice, or course of business which operates as a fraud or deceit upon any [client](/usc/15/80b–11.md?p=a) or prospective [client](/usc/15/80b–11.md?p=a);
- (3) acting as principal for his own [account](/usc/15/1681a.md?p=r-4), knowingly to sell any [security](/usc/15/80b–2.md?p=a-18) to or [purchase](/usc/15/78c–5.md?p=g) any [security](/usc/15/80b–2.md?p=a-18) from a [client](/usc/15/80b–11.md?p=a), or acting as [broker](/usc/15/80b–2.md?p=a-3) for a [person](/usc/15/80b–2.md?p=a-16) other than such [client](/usc/15/80b–11.md?p=a), knowingly to effect any sale or [purchase](/usc/15/78c–5.md?p=g) of any [security](/usc/15/80b–2.md?p=a-18) for the [account](/usc/15/1681a.md?p=r-4) of such [client](/usc/15/80b–11.md?p=a), without disclosing to such [client](/usc/15/80b–11.md?p=a) in writing before the completion of such transaction the capacity in which he is acting and obtaining the consent of the [client](/usc/15/80b–11.md?p=a) to such transaction. The prohibitions of this paragraph shall not apply to any transaction with a [customer](/usc/15/78c–5.md?p=g) of a [broker or dealer](/usc/15/78c.md?p=h-2) if such [broker or dealer](/usc/15/78c.md?p=h-2) is not acting as an [investment adviser](/usc/15/6102.md?p=d-2-B-ii) in relation to such transaction; or
- (4) to engage in any act, practice, or course of business which is fraudulent, deceptive, or manipulative. The [Commission](/usc/15/80b–2.md?p=a-4) shall, for the purposes of this [paragraph (4)](#4) by rules and regulations define, and prescribe means reasonably designed to prevent, such acts, practices, and courses of business as are fraudulent, deceptive, or manipulative.

## Source credit

(Aug. 22, 1940, ch. 686, title II, § 206, 54 Stat. 852; Pub. L. 86–750, §§ 8, 9, Sept. 13, 1960, 74 Stat. 887; Pub. L. 111–203, title IX, § 985(e)(2), July 21, 2010, 124 Stat. 1935.)

## Notes

### Editorial Notes

### Amendments

2010—Par. (3). Pub. L. 111–203 inserted “or” at end.

1960—Pub. L. 86–750, § 8, struck out “registered under section 80b–3 of this title” from introductory text.

Par. (4). Pub. L. 86–750, § 9, added par. (4).

### Statutory Notes and Related Subsidiaries

### Effective Date of 2010 Amendment

Amendment by Pub. L. 111–203 effective 1 day after July 21, 2010, except as otherwise provided, see section 4 of Pub. L. 111–203, set out as an Effective Date note under section 5301 of Title 12, Banks and Banking.