- Chief Compliance Officer and VP of Legal Affairs, Arrow Electronics
By 
Aaron Nicodemus2023-08-24T13:41:00
The Securities and Exchange Commission (SEC) passed a sweeping set of rules for the $26 trillion private fund industry designed to increase transparency and competition but with provisions that address industry concerns about potential overreach.
The rules and amendments to the Investment Advisers Act, approved by the SEC in a 3-2 vote Wednesday, target certain practices in the private funds industry that “may impose significant risks and harms on investors and private funds,” according to an SEC fact sheet.
Those practices include conflicts of interest generated by the charging of certain fees and expenses (restricted activities rule), as well as preferential treatment offered to some fund investors—but not all—through the use of side letters (preferential treatment rule).
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A federal appeals court struck down the Securities and Exchange Commission’s private fund adviser rule, agreeing with industry advocates that the agency overstepped its authority.
A lawsuit filed by industry groups alleging the Securities and Exchange Commission overstepped its authority when it passed new rules for private fund advisers is unlikely to stop their implementation, according to experts.
Even though compliance dates for the Securities and Exchange Commission’s new private fund rules are a year to 18 months away, compliance teams should start analyzing the impact now, according to experts.
Any product that uses AI needs to be safety assessed for its entire lifespan under new rules that went into effect recently across the EU. Experts warned companies using AI to tailor products could be classed as “manufacturers” and face the same duty of care as developed.
When lawmakers slam the U.K.’s chief financial regulator as “incompetent,” it not only opens the doors for others to pile criticism on it, but it sparks a debate about how the organization can be improved–or removed.
The U.K. Financial Conduct Authority apologized to investors in peer-to-peer investment firm Collateral for not acting swiftly enough to prevent Collateral from defrauding its customers.
