Doug Cornelius on compliance for private equity real estate
Sliding in at the end of the deadline, FinCEN released an interim final rule that removes the beneficial ownership reporting requirements for U.S. companies and limits it to only those entities that are formed under the law of a foreign country and that have registered to do business in any U.S. State or Tribal jurisdiction. The … Read more »
On March 19, the Division of Investment Management published an updated FAQ on the Marketing Rule addressing extracted performance. The January 2023 Marketing Rule FAQ on extracted performance has been substantially revised. The old FAQ had required the calculation of new return for the performance shown in a case study for a private fund. I … Read more »
There has been an uptick in more sophisticated fraudsters posing as registered representatives, investment advisers and their firms. In December, the SEC charged three individuals with impersonating financial professionals in fraud scheme targeting retail investors. With the money stolen does the victim have a case against the legitimate firm? Mark Frank Harding fell victim to … Read more »
The definition of “accredited investor” is at the nexus of the Securities and Exchange Commission’s missions: (1) to protect investors, (2) to maintain fair, orderly, and efficient markets, and (3) to facilitate capital formation. If you’re an accredited investor you have access to private offerings. That enables capital formation. Private offerings are not subject to … Read more »
One of the main pillars of compliance with investment advisers and investment funds is to stay within the guardrails. If you’ve told your investors you’re doing a particular type of investing, do that type. If you’ve told your investors that you won’t do something, don’t do it. Obviously, if you’ve told your fund investors that … Read more »
Following the FinCEN announcement that it was going to ignore the Corporate Transparency Act requirement, the law suffered another loss in a Michigan case. This time the loss was due to a different part of the consitution. Judge Jonker in the Western District Court of Michigan in the Small Business Association of Michigan v. Janet … Read more »
Maybe? On Sunday the Treasury Department announced that there would be no future enforcement of the Corporate Transparency Act against US companies. The Treasury Department is announcing today that, with respect to the Corporate Transparency Act, not only will it not enforce any penalties or fines associated with the beneficial ownership information reporting rule under … Read more »
In a move that was only surprising in its speed of delivery, the SEC stated: It is the Division’s view that transactions in the types of meme coins described in this statement, do not involve the offer and sale of securities under the federal securities laws.[4] As such, persons who participate in the offer and sale … Read more »
The ups and down of the Corporate Transparency Act and its Beneficial Ownership Information reporting continue to smash compliance and legal departments against their lap bars. The current release from FinCEN feels like another loop-de-loop. On February 18, 2025, the U.S. District Court for the Eastern District of Texas in the case of Smith, et … Read more »
Switching clients from different business models can be good for the clients. Of course, it can also be very lucrative to switch models for the adviser and bad for the clients. Unfortunately, for the clients for Michael DeRosa when he joined One Oak it was bad for his clients. According to the SEC order, Mr. … Read more »