SEC Chair Gary Gensler spoke earlier today at the Institutional Limited Partners Association (ILPA). The full text is available here.
The speech is remarkable because it marks a significant shift in SEC attention to the biggest issues affecting institutional investors in private markets. Highlights include the following:
- Fees in private investments are not reflecting fee reductions in public investment vehicles.
- The SEC will examine ways to reduce conflicts of interest in private investments.
- The SEC will look at what it recognizes as the inequities of side letters.
- Fiduciary duty waivers violate the Advisers Act, regardless of the investor’s sophistication.
- Form PF can be improved to extract better and timelier information.
There will be a great deal of attention on this speech in the financial markets, and for good reason.
We anticipate seeing helpful rulemaking from the SEC in the next 6-12 months.
Please let us know if you have any questions or would like to discuss this development.
Kristen M. Chatterton