The Securities and Exchange Commission (the “Commission”) recently issued an Investor Bulletin with guidelines on compliance with its “custody rule” for investment advisers. While the rule is designed to enhance safeguards over client assets, clients still need to be aware of the specific steps taken by their advisers to comply with the rule. Custody relates to the holding of client funds or securities, directly or …
Private Equity Funds Compliance Lapses Lead to SEC Sanctions
By Ryan Finn and Simon Riveles On March 11th, the SEC announced two decisions involving private equity firms that demonstrate its commitment to emphasizing the important role of compliance in preventing and detecting possible violations of the securities laws. Although these cases dealt specifically with the activities of private equity firms, the issues raised by the SEC’s decisions were broad enough to be relevant and …