SEC proposes rule amendments to expand private fund reporting requirements

On Behalf of | Jan 31, 2022 | Securities and Compliance

The Securities and Exchange Commission has approved proposing rules amendments that would require certain financial advisers to provide more current reporting when key events occur.

In a news release, the SEC said it will propose amendments to its Form PF, which is required to be filed by SEC-registered investment advisors who manage certain private funds.

Under the proposal, large hedge fund and private equity advisers would be required to file reports within one day of events that indicate significant stress at a fund that could harm investors or signal risk in the broader financial system.  Currently, the PF forms are required to be filed quarterly or annually.

The SEC said the changes were aimed at enhancing the Financial Stability Oversight Council’s ability to assess systemic risk. The commission also said it wanted to strengthen its oversight of private fund advisers and protection of investors given the growth of the private fund industry since Form PF was adopted in 2011.

“The Commission and Financial Stability Oversight Council now have almost a decade of experience analyzing the information collected on Form PF,” said SEC Chair Gary Gensler. “We have identified significant information gaps and situations where we would benefit from additional information.”

The commission said the one day reporting requirement would provide it with more timely information to help assess the risks to investors and the markets. The proposal would also decrease the reporting threshold for large private equity firms to $1.5 billion from $2 billion in assets under management.

There will be a public comment of 30 days after the SEC’s proposal is published on SEC.gov and in the Federal Register.

The securities and compliance attorneys at Lewitas Hyman include former senior attorneys at the SEC who fully understand the regulatory scrutiny financial professionals and their firms face from the various regulators that oversee the financial services industry. If your firm is facing an investigation from a regulatory agency, please contact us at (888) 655 6002 or through our online contact form.

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