Torys lawyers discuss SEC's 2019 priorities

January 29, 2019

Torys New York Partners Venera Ziegler and Andrew Beck, and Counsel Christopher Caparelli have written “Private funds watch: the SEC’s 2019 agenda” for PE Hub Canada, highlighting key points of the Office of Compliance Inspections and Examinations (OCIE) 2019 examination priorities. They also provide some reminders of annual reporting obligations applicable to private fund sponsors.

A small excerpt from their article is below.

OCIE will continue to conduct risk-based examinations of investment advisers that have never been examined, newly registered investment advisers, and advisers that have not been examined for a number of years and have substantially grown or changed their business models.

Although not directly addressed in the 2019 examination priorities, during examinations, examiners continue to focus on valuation practices, performance presentations and calculations, presentations of internal rate of return and the effect of subscription credit facilities on such returns, pay to play practices, the testimonial rule and the custody rule.

Investment advisers should review their existing practices, policies and procedures to ensure consistency with the SEC’s enforcement priorities and areas of focus.

Investors should be aware and take into account these specific areas of SEC focus when conducting their diligence with respect to a potential investment.

Read about the other notable 2019 examination priorities affecting private funds on PE Hub Canada for our lawyers expertise on topics such as cybersecurity, digital assets, conflicts of interest, fees and expenses, CFIUS reform and filing obligations.

This piece also appeared as a part of the Q1 Torys Quarterly, which includes articles on Canadian M&A, Chinese investment into Canada, issues for boards of directors, real-estate, AI and more.


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