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SEC Rulemaking Expands Accredited Investor Definition

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On August 26, 2020, the Securities and Exchange Commission adopted amendments and issued a related order to expand the definition of “accredited investor” under Rule 501(a) of the Securities Act to include natural persons with certain professional certifications, designations; credentials issued by an accredited educational institution, including Series 7, Series... Read More

Topics: Investment Advisers, Public Companies and Securities

SEC Charges Alternative Asset Manager with Failing to have Sufficient Policies to Prevent Use of MNPI

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In 2016, Ares Management LLC, a subsidiary of a global alternative asset manager, invested several hundred million dollars in client funds in a portfolio company in the form of debt and equity. Confidentiality provisions in the loan agreement remained in effect between Ares and the portfolio company on a going... Read More

Topics: Investment Advisers, Private Equity, Public Companies and Securities

SEC Clarifies Investment Advisers’ Proxy Voting Responsibilities and Application of Proxy Rules to Voting Advice

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The SEC provided guidance to assist investment advisers in fulfilling their proxy voting responsibilities. The guidance discusses, among other matters, the ability of investment advisers to establish a variety of different voting arrangements with their clients and matters they should consider when they use the services of a proxy advisory... Read More

Topics: Investment Advisers, Public Companies and Securities

SEC Charges Hedge Fund with 13D Violation

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The SEC charged a hedge fund sponsor that manages private funds and separately managed accounts focused on global distressed, special situations, and opportunistic investing with failure to timely file a Schedule 13D. The hedge fund had previously reported its holding on Schedule 13G. The hedge fund had a senior managing... Read More

Topics: Investment Advisers, Litigation, Private Equity, Public Companies and Securities

SEC Proposed Interpretive Guidance for Investment Advisers: Implications for Private Equity

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The SEC’s recent proposed guidance for investment advisers has implications for private equity sponsors.  Perhaps the most important part of the guidance for private equity sponsors is that related to the duty of loyalty which addresses conflicts of interest.  By nature the sponsor’s relationship with investors is complex, and inherent... Read More

Topics: Investment Advisers, M&A

SEC Invites Regulated Entities to Voluntarily Submit Self-Assessments of Diversity Policies and Practices

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The SEC Office of Minority and Women Inclusion, or OMWI, invited entities regulated by the SEC to submit a Diversity Assessment Report. Entities regulated by the SEC include broker-dealers, investment advisers, investment companies (mutual funds), transfer agents, municipal advisors, private fund advisers, clearing agencies, nationally recognized statistical rating organizations, national... Read More

Topics: Broker-Dealer, Employment, Investment Advisers, Municipal Advisors, Private Equity

SEC Identifies Most Frequent Compliance Issues Associated with Advertising by Investment Advisers

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The SEC’s Office of Compliance Inspections and Examinations has provided a list of compliance issues relating to Rule 206(4)-1, which is referred to as the Advertising Rule, under the Investment Advisers Act of 1940. In general, the Advertising Rule prohibits an adviser, directly or indirectly, from publishing, circulating, or distributing... Read More

Topics: Investment Advisers, Private Equity