Dechert Submits Comment Letter to the SEC that is Highly Critical of the Office of Financial Research’s Report on “Asset Management and Financial Stability”


Thomas P. Vartanian, Chair of Dechert’s Financial Institutions practice, responded to the U.S. Securities and Exchange Commission's (SEC) request for comments, on behalf of certain clients, by comprehensively criticizing the methodology, operating predicates and lack of factual or legal support for the Office of Financial Research’s Report on Asset Management and Financial Stability (Report). 

Dechert’s letter lays out a series of fundamental legal and logical defects in the Report:

  1. It fails to appreciate the fundamental differences between the role played by asset managers as agents for investors and balance sheet companies that act as principals.
  2. It simplistically homogenizes a diverse asset management industry and discusses very different investment vehicles, structures and investment strategies in a one-size-fits-all manner.
  3. Its implications regarding risks that may be associated with floating net asset value mutual funds are unsupported by empirical evidence or models.
  4. It does not properly consider the critical role of SEC regulation.
  5. It does not provide the foundation for informed discussions of asset management entities, activities or markets, let alone a valid legal or logical basis for regulatory action.

Download the comment letter (PDF)

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Dechert LLP | Attorney Advertising

Written by:


Dechert LLP on:

Popular Topics
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:

Sign up to create your digest using LinkedIn*

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.

Already signed up? Log in here

*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.