Stay up-to-date with the latest developments in securities law through access to both news and all statutes and regulations. Find relevant corporate filings through a searchable EDGAR database. And...
Nov. 5 — Private equity disclosure issues are in the crosshairs of the Securities and Exchange Commission, Julie Riewe, a top agency enforcement official, said in a video interview with Bloomberg BNA.
The agency will bring “more conflicts-type cases, as well as fee and expenses” cases, said Riewe, the co-chair of the Asset Management Unit in the Securities and Exchange Commission Enforcement Division.
The agency has expanded its efforts in that arena recently, including recent enforcement actions against Blackstone Group LP and Kolhberg Kravis Roberts & Co.
Riewe recorded the interview after appearing on a panel at the Securities Enforcement Forum in Washington, which was sponsored by Securities Docket.
The SEC is looking at how private equity firms disclose their travel and entertainment expenses, as well as discounts provided to third-party vendors, including law firms, Riewe said.
The agency also is seeking to ensure proper disclosures when advisory employees that “are labeled as consulting partners” are billed to a fund, instead of from management expenses, she said.
Riewe advised that private equity firms should take a look at their longstanding governing documents to ensure that current practices haven't evolved away from what the old disclosures indicate.
Firms are “making sure they’ve disclosed all sorts of conflicts, including any sorts of revenue they’re getting from relationships with affiliates,” which is another area of SEC focus, she added.
In recent cases, Blackstone settled for nearly $40 million in October on allegations of inadequate fee disclosures (47 SRLR 1944, 10/12/15)(195 SLD, 10/8/15)(See previous story, 10/08/15).
KKR settled for almost $30 million in June in connection with allegations that it misallocated “broken-deal” expenses to fund clients (47 SRLR 1334, 7/6/15)(125 DER 125, 6/30/15)(125 SLD, 6/30/15).
And, earlier in November, Fenway Partners LLC settled, for $10 million after SEC accusations that it failed to disclose conflicts of interest in how it handled client money (213 SLD 213, 11/4/15).
To contact the reporter on this story: Rob Tricchinelli in Washington at email@example.com
To contact the editor responsible for this story: Phyllis Diamond at firstname.lastname@example.org
The video of the BBNA interview with Riewe is online at /secs-private-equity-m57982063200/.
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to email@example.com.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to firstname.lastname@example.org.
Put me on standing order
Notify me when new releases are available (no standing order will be created)