News & Analysis as of

Private Equity Investment Advisers Act of 1940

Williams Mullen

SEC Private Fund Rule Struck Down by US Appeals Court

Williams Mullen on

A U.S. appeals court struck down a newly adopted Securities and Exchange Commission (“SEC”) rule implementing a series of new disclosure requirements and restrictions on private fund advisors....more

Adler Pollock & Sheehan P.C.

Do Your Assets Include Unregistered Securities? This Asset Class Requires Special Planning

When it comes to estate planning, addressing all your assets should be a priority. However, certain assets require greater attention than others. For example, if your assets include unregistered securities, such as restricted...more

Vinson & Elkins LLP

New SEC Private Equity Rules

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On February 9, 2022, the Securities and Exchange Commission (“SEC”) proposed new rules under the Investment Advisers Act of 1940 regarding the regulation of private funds.1 A private fund is an investment company, usually a...more

Benesch

SEC Adopts New Rules For Private Fund Advisers

Benesch on

On August 23, 2023, the Securities and Exchange Commission (“SEC”) formally adopted new rules and amendments (collectively, the “Final Rule”) under the Investment Advisers Act of 1940, as amended (the “Advisers Act”), that...more

Morrison & Foerster LLP

Marketing Private Funds to U.S. Investors — A Practical Guide for Asia-Based Managers

As the private equity (“PE”) and venture capital (“VC”) funds industry grows and matures in Asia, managers are increasingly looking to market interests in their funds to U.S.-based investors. However, many Asia-based managers...more

Proskauer - The Capital Commitment

SEC Overreach: Insurers Underwrite?

Implications of SEC attempt to curb indemnification for private fund managers - The SEC spent 2022 making multiple and sweeping proposals to amend rules under the Advisers Act, many of which have the ability to...more

Skadden, Arps, Slate, Meagher & Flom LLP

SEC Risk Alert Spells Out the Agency’s Expectations for Investment Advisers as New Marketing Rule Takes Effect

As we noted in the October 2022 edition of our Investment Management Update, on September 19, 2022, the U.S. Securities and Exchange Commission’s (SEC’s) Division of Examinations (Examinations) issued a risk alert to inform...more

ArentFox Schiff

SEC Charges Private Equity Adviser for Undisclosed Disproportionate Allocation of Transaction Expenses to Advised Fund

ArentFox Schiff on

On June 14, 2022, the US Securities and Exchange Commission (SEC) released an order charging private equity adviser Energy Capital Partners Management, LP (ECP) with Investment Advisers Act violations in connection with a...more

Proskauer - The Capital Commitment

Increased Regulatory Focus on Privacy and Cybersecurity for Private Funds in 2022

2021 continued the trend of increased regulatory focus on privacy and cybersecurity for private investment funds in the U.S. and abroad. There are no signs of the trend leveling off any time soon. One of the topics that...more

Vinson & Elkins LLP

Private Equity: Private No More?

Vinson & Elkins LLP on

On February 9, 2022, the Securities and Exchange Commission (“SEC”) proposed new rules under the Investment Advisers Act of 1940 (“IAA”) to regulate advisers to private funds. One set of the proposed rules is intended to...more

Morgan Lewis

SEC Proposes Sweeping New and Amended Rules under Advisers Act to Overhaul Private Fund Industry

Morgan Lewis on

In the span of two weeks, the US Securities and Exchange Commission (SEC) has proposed rules that would significantly overhaul the regulation of the private fund industry. Specifically, on January 26, the SEC issued proposed...more

Akin Gump Strauss Hauer & Feld LLP

The SEC is Kicking Off 2022 With a Renewed Focus on the Private Funds Industry: A Review of Recent Enforcement Actions and their...

Private funds should be prepared for increased oversight from the Securities and Exchange Commission (SEC), following a landmark year of enforcement cases. In 2021, the Commission brought 159 enforcement actions against...more

Pillsbury Winthrop Shaw Pittman LLP

Dollar Threshold Change for “Qualified Client” Definition under the Investment Advisers Act

Most 3(c)(1) private equity and hedge funds are impacted; exempt venture capital funds are not impacted. Effective August 16, 2021, the dollar thresholds specified in the definition of “qualified client” under Rule 205-3...more

Proskauer Rose LLP

SEC Increases Advisers Act Qualified Client Threshold

Proskauer Rose LLP on

On June 17th, the Securities and Exchange Commission (the “Commission”) issued an order adjusting the dollar amount thresholds for clients of registered advisers to be “qualified clients” under rule 205-3 of the Investment...more

Troutman Pepper

The Long and Short of It

Troutman Pepper on

In January 2021, commentary by members of the social news aggregator Reddit may have contributed to unprecedented trading activity that led some online brokerages to freeze trading of certain securities for a prolonged window...more

Skadden, Arps, Slate, Meagher & Flom LLP

Proposed Legislation Would Enhance Closed-End Fund Protections by Closing the Private Funds Loophole Under Section 12(d)(1) of the...

On November 19, 2020, U.S. Representative Anthony Gonzalez (R-OH) introduced the Increasing Investor Opportunities Act (IIOA). The IIOA, among other things, would require private funds to comply with the 10% limitation on...more

Troutman Pepper

SEC Amends “Accredited Investor” Definition

Troutman Pepper on

On August 26, the U.S. Securities and Exchange Commission (SEC) adopted amendments expanding the definition of “accredited investor” to allow additional categories of investors to invest in unregistered private offerings. The...more

Proskauer - The Capital Commitment

Private Equity Adviser Settles with SEC for Misallocation of Internal Expenses Relating to “Third-Party Tasks”

The SEC issued an order imposing sanctions against private equity adviser Rialto Capital Management, LLC (“Rialto”) for violations of the Advisors Act relating to expense allocation. The settlement addressed Rialto’s...more

Fox Rothschild LLP

SEC Prepping For A New Round Of Attacks On Fund Advisers

Fox Rothschild LLP on

The SEC’s Office of Compliance Inspections and Examinations (“OCIE”) conducted a series of examinations into private fund advisers. See https://www.sec.gov/files/Private%20Fund%20Risk%20Alert_0.pdf. To say the least, OCIE was...more

Troutman Pepper

Rights And Risks In The Age Of Transparency

Troutman Pepper on

In its examinations of investment managers over the past decade, the SEC has consistently focused intensely on conflicts, disclosures and fiduciary duties. Originally published in The Legal Supplement: Expert Commentary -...more

Proskauer - The Capital Commitment

Fund Sponsor’s Fee Calculation Mistake Leads to SEC Enforcement

A settlement last week involving a private equity fund sponsor is a reminder that compliance with fee calculation provisions and valuation policies and procedures are crucially important for fund managers. Even when an error...more

Morrison & Foerster LLP

The SEC Continues to Spread Sunshine on Private Equity: Reflections on Two Recent Enforcement Actions

The end of 2018 was notable for two SEC enforcement actions against private equity fund managers for violations of the Investment Advisers Act of 1940 arising from improper allocations of expenses, undisclosed conflicts of...more

Stinson - Corporate & Securities Law Blog

SEC Tags Private Equity Group for Accelerated Fees

The SEC entered into an agreed settlement with a private equity group for receiving accelerated fees without the consent of all necessary parties prior to the commitment of capital....more

K&L Gates LLP

SEC Broadens Enforcement Activity Related to Private Equity Fees and Expenses — And Narrows the Opportunity for Managers to...

K&L Gates LLP on

On December 21, 2017 the U.S. Securities and Exchange Commission (the “SEC”) published a settlement order with TPG Capital Advisors, LLC (“TPG”) arising from insufficient disclosure regarding the acceleration of monitoring...more

Ballard Spahr LLP

Investment Management Update

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Investment Adviser AXA Wins Excessive Fee Trial - A federal judge in New Jersey has ruled in favor of AXA Equitable Life Insurance Company (AXA Equitable) and its wholly owned subsidiary, AXA Equitable Funds Management...more

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