What is the legal definition of exercising discretion?
Section 3(a)(35) of the Securities Exchange Act of 1934, 15 U.S.C. 78c(a)(35), states “[a] person exercises investment discretion’ with respect to an account if” such person “. . . is authorized to determine what securities or other property shall be purchased or sold by or for the account,” or “makes decisions as to what securities or other property” to buy or sell for the account, “even though some other person may have responsibility for such investment decisions,” or “otherwise exercises such influence with respect to the purchase and sale of securities or other property by or for the account . . . .” Scott E. Wiard, Securities Exchange Act Rel. No. 50393 (Sept. 16, 2004), __ SEC Docket ___ (citing Hotmar v. Lowell H. Listrom & Co., 808 F.2d 1384, 1385 (10th Cir. 1987) (comparing discretionary and non-discretionary accounts)).
