Investment Fund Law Blog

InvestmentFundLawBlog

Updates and Insights on Legal Issues Facing Fund Managers and Investors

Category Archives: Private Equity

Subscribe to Private Equity RSS Feed

When Sharing Isn’t Caring

Posted in Investment Advisers, Private Equity
On September 22, 2014, the Securities and Exchange Commission (the “SEC”) charged private equity fund adviser, Lincolnshire Management, Inc. (“Lincolnshire”), with misallocating expenses shared between two portfolio companies. Lincolnshire integrated two portfolio companies that were each owned by a different Lincolnshire private equity fund. Lincolnshire owed a fiduciary duty to each fund and such fiduciary … Continue Reading

SEC Enforcement Against Short Sellers Continues

Posted in Investment Advisers, Private Equity
On September 16, 2014, the Securities and Exchange Commission (“SEC”) announced the latest sanctions in a continuing enforcement initiative against certain hedge fund advisers and private equity firms that have participated in an offering of a stock after short selling it during a restricted period in contravention of SEC rules. The SEC last year announced … Continue Reading

2014 Examination Priorities Published by the SEC

Posted in Broker-Dealers, Investment Advisers, Private Equity, Private Funds
Today, the Securities and Exchange Commission published its 2014 priorities for its National Examination Program (“NEP”).  These priorities cover a wide range of issues at financial institutions, including investment advisers and investment companies, broker-dealers, clearing agencies, exchanges and other self-regulatory organizations, hedge funds, private equity funds, and transfer agents.  Similar to the 2013 priorities, the … Continue Reading

The Securities and Exchange Commission Opens the Door for Hedge Fund Advertising

Posted in Advisory, Investment Advisers, Private Equity, Private Funds
Written by:  Jay B. Gould and Jessica Brown On July 10, 2013, the Securities and Exchange Commission (“SEC”) voted to lift the ban on general solicitation and advertising by private funds (and other private company issuers) as mandated by Congress in the Jumpstart Our Business Startups Act (“JOBS Act”). In addition to lifting the ban on … Continue Reading

SEC Hammers Private Equity Fund Manager

Posted in Advisory, Investment Advisers, Private Equity, Private Funds
Written by:  Jay Gould Last month, the Securities and Exchange Commission (the “SEC”), published its examination priorities for 2013.  As we suggested in our Blog posting at that time, the SEC is fixated on examining and bringing enforcement against its newest class of investment adviser – managers of private equity funds.  Fast forward four weeks, … Continue Reading

SEC Issues Additional Guidance Regarding the Custody Rule After Finding Wide Spread and Varied Non-Compliance By Investment Advisers

Posted in Advisory, Investment Advisers, Private Equity, Private Funds
Written by: Jay Gould and Michael Wu Last week the SEC issued a Risk Alert and an Investor Bulletin on the Custody Rule after its National Examination Program (“NEP”) observed significant deficiencies in recent examinations involving custody and safety of client assets by registered investment advisers.  The stated purpose of the Risk Alert was to … Continue Reading

Private Equity: Blindsided by the FCPA– Hedging Against Anti-Corruption Deal Risk

Posted in Private Equity
Written by:  G. Derek Andreson, James L. Kelly, Christopher M. Zochowski, Marc H. Axelbaum and Ryan R. Sparacino  This article was also published in Law360. Until a few years ago, private equity firms enjoyed relative insulation from regulatory scrutiny of overseas acquisitions and the operations of multi-national portfolio companies. No longer is that the case. … Continue Reading

SEC Examinations Target Private Equity and Hedge Fund Managers for 2013

Posted in Broker-Dealers, Investment Advisers, Private Equity, Private Funds, Registered Investment Companies
Written by:  Jay Gould and Michael Wu  On February 21, 2013, the Staff of the Securities and Exchange Commission (the “Staff” and the “SEC,” respectively) published its 2013 priorities for the National Examination Program (“NEP”) in order to provide registrants with the opportunity to bring their organizations into compliance with the areas that are perceived … Continue Reading

Limiting Private Equity Fund Exposure to the ERISA Obligations of Portfolio Companies

Posted in Advisory, Private Equity
By Peter J. Hunt, Susan P. Serota, Matthew C. Ryan1 In welcome news for private equity (“PE”) funds, a recent district court opinion determined that two PE funds and their bankrupt portfolio company were not a “controlled group” and thus the PE funds were not responsible for pension liabilities at the portfolio company. The decision, Sun … Continue Reading

NASAA President Criticizes New SEC Rule Allowing General Advertising

Posted in Private Equity, Private Funds
Written by:  Jay Gould and Peter Chess Heath Abshure, President of the North American Securities Administrators Association (NASAA) and Arkansas State Securities Commissioner, sharply criticized the Securities and Exchange Commission’s (the SEC’s) new rulemaking that will lift restrictions on general solicitation and general advertising for hedge funds and other private investment vehicles in a press-teleconference … Continue Reading

SEC Approves Confidential Private Fund Systemic Risk Reporting

Posted in Investment Advisers, Private Equity, Private Funds
Written by Jay Gould On October 26, 2011, the SEC adopted a new rule requiring SEC-registered advisers to hedge funds and other private funds with at least $150 million in private fund assets under management to report information to the Financial Stability Oversight Council (“FSOC”) to enable it to monitor risk to the U.S. financial … Continue Reading

“How Do You Really Feel?” Issa Challenges the SEC

Posted in Private Equity
Written by Jay Gould, Ildi Duckor and Michael Wu On March 22, 2011, U.S. House Oversight Committee Chairman Darrell Issa (R., Calif.), sent a sharply worded letter to Chairman Mary Schapiro of the Securities and Exchange Commission (the “SEC”), in which he demanded that the SEC justify several of its rules regarding raising capital, including … Continue Reading

SEC Proposes Rule Regarding Private Fund Systemic Risk Reporting

Posted in Investment Advisers, Private Equity, Private Funds
Written by Michael Wu On January 26, 2011, the SEC proposed a rule that would require SEC-registered advisers to hedge funds, private equity funds and other private funds to report information to the Financial Stability Oversight Council (“FSOC”) that would enable it to monitor risk to the U.S. financial system.  The information would be reported … Continue Reading

Institutional Limited Partners Association Publishes New Private Equity Fund Guidelines

Posted in Private Equity
Written by Michael Wu Earlier this month, the Institutional Limited Partners Association (“ILPA”) published Version 2.0 of its Private Equity Principles (the “Principles”).  The Principles set forth the ILPA’s take on the best practices in establishing private equity partnerships between limited partners (“LPs”) and the general partner (“GP”).  The Principles focus on three guiding tenets … Continue Reading