In an address at the Securities Enforcement Forum West, SEC Enforcement Division Director Andrew Ceresney focused on actions against private equity fund advisers. Mr. Ceresney identified three activities by equity fund advisers that are scrutinized by the SEC: (i) undisclosed fees and expenses; (ii) the impermissible shifting and misallocating of expenses; and (iii) failures to disclose conflicts of interests adequately, including conflicts arising from fee and expense issues. He cited eight recent enforcement actions by the SEC against the private equity industry to illustrate these activities. Mr. Ceresney asserted that firms have improved their fee disclosures on their ADV Forms, as a result of these enforcement actions.
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