SEC Warns: “the number of cases involving private equity will increase.”

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On January 23, the Chief of the Securities Exchange Commission’s Asset Management Unit (“AMU”), Bruce Karpati, participated in a question and answer session at the Private Equity International Conference. He discussed the SEC’s plans for oversight of the private equity industry and said that “it’s not unreasonable to think that the number of cases involving private equity will increase.”

The recent nomination of Mary Jo White for SEC Chairman further highlights the increased emphasis placed on enforcement. When he nominated Ms. White, President Obama emphasized this theme, stating that “it’s not enough to change the law. We also need cops on the beat to enforce the law.”

Effect of Asset Management Unit on SEC’s Private Equity Activities

The AMU was formed as a distinct group in 2010. The unit has focused on “generating expertise” in the areas it covers. It has hired industry specialists, including people hired from private equity firms. According to Mr. Karpati, these efforts have helped the AMU identify “promising cases” for enforcement earlier.

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Topics:  Asset Management, Chief Compliance Officers, Compliance, Enforcement Actions, Private Equity, SEC

Published In: Business Organization Updates, Business Torts Updates, Securities Updates

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.

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