SEC Sweep Letter for Private Equity Funds

SEC Sweep Letter for Private Equity Funds

The San Francisco Office of the SEC has an informal inquiry into the valuations of private equity funds. IA Watch has received a copy of the sweep letter from the Division of Enforcement directed to a private equity fund manager.

Some highlights in the request:

  • All formation and offering documents for the fund, including private placement memoranda, limited partnership agreements, and operating agreements
  • List of investors and capital commitments
  • List of all investments, realized amount, and gross IRR
  • All communications with investors regarding fund performance
  • Support for valuations of the fund assets for the most recent fiscal year

It seems to be a fairly short list for an SEC document request. But any SEC document request is intimidating.

The request shouldn't be construed as indication that there has been a violation of the federal securities law. It's indication that the SEC is continuing to look for funds and managers that manipulated valuations.


For additional commentary on developments in compliance and ethics, visit Compliance Building, a blog hosted by Doug Cornelius.

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