These are my notes from the Private Fund Compliance Forum 2013. They are live notes from the forum, so please forgive my typos.
Jason E. Brown, Partner, Ropes & Gray LLP
Reuben B. Ackerman, Chief Compliance Officer, Berkshire Partners LLC
Terry E. Everett, Chief Financial Officer & Chief Compliance Officer, Rockland Capital, LLC
Daniel H. Weintraub, Managing Director & General Counsel, Audax Group
The CCO should not be the sole person in the firm responsible for compliance. It requires all employees to care and all managers to take responsibility.
Engage accounting. They see the flow of cash, employee expenses, political contributions and entertainment expenses. They would also be on the frontline for money laundering risks.
The investor relations team should see it as an extension of their role. Investors want to see compliance and see it as necessary for their investment choices.
Put a candy bowl in your office, it’s a great way to lure employees in with questions.
Technology tools are important to improve productivity.
Email surveillance? It’s not required by SEC rules, but it seems to always come up in SEC audits. Use keywords. You will need to deal with lots of false positives.
Personal securities trading is difficult. Employees will want that information to be limited to one or a very few people. You should not disclose that information to other employees. You need to be concerned about the privacy concerns.
Should all employees be access employees? You need to have access to non-public information and need to be a supervised person. All employees are supervised persons. Most likely you do not have effective barriers to prevent employees from getting non-public information. For example, an administrative assistant may see a memo about an upcoming transaction.
When thinking about pushing the boundaries of SEC rules think about the disclosure to investors when they ask about a deficiency letter.
Should you monitor personal email accounts on third party email platforms like gmail, or yahoo mail. Have them certify that they do not use personal email accounts for work email.
