It’s always useful to look at what your competition is doing. The same is true in drafting your code of conduct (or code of...
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Private Investment Funds
Dodd’s Solo View on Private Investment Funds
Senator Dodd did not forget about private investment funds. Tucked into page 366 of his 1366 page Restoring American Financial Stability Act of 2010 is the Private Fund Investment Advisers Registration Act.
This is largely the same language in the Private Fund Investment Advisers Registration Act of 2009 contained in Dodd’s draft Restoring American Financial...
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New York City Enacts New Rules for Its Pension Fund Investments
New York City Comptroller John C. Liu announced sweeping changes in the way New York City pension funds make investment decisions. Following the lead of New York state and several other states, New York City is changing how it deals with gifts, campaign contributions and placement agents.
Ban on Campaign Contributions
Comptroller Liu declines any campaign...
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California Proposes Having Placement Agents Register
Placement agents would have to register as lobbyists under legislation proposed by Assemblyman Ed Hernandez (D-West Covina). The legislation would define placement agents as lobbyists in accordance with the state’s Political Reform Act. Placement agents would have to register as lobbyists before pitching investment ideas to public pension plans in California.
It seems like...
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Carried Interest Tax Legislation Suddenly Appears and Moves Forward
Tucked into the Tax Extenders Act of 2009 (H.R. 4213), is a provision targeted at partnership interests held by partners providing services.
This proposal seems to be the same proposal offered by Congressman Sandy Levin from the 12th District of Michigan in H.R. 1935 which has been sitting in Committee [See prior post: Carried Interest...
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Classification of Private Funds as Publicly Traded Partnerships
Due to the increasing incidence of fund investors who want to transfer their investment fund interests, private investment funds face a risk of being classified as publicly traded partnerships. That would mean the fund would become taxable as a corporation.
A bad result.
Under Internal Revenue Code § 7704, a partnership will be classified as a publicly...
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Another Private Fund Registration Bill
As expected, Senator Dodd introduced a comprehensive bill for revising the regulatory system for the U.S. financial services industry.
Restoring American Financial Stability Act of 2009.
You can tell its comprehensive because the discussion draft weighs in at 1,136 pages. I have not read all of it, but I did focus in Title IV: Regulation of...
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Private Fund Investment Advisers Registration Act is Passed by House Committee
The House Financial Services Committee passed H.R. 3818, the Private Fund Investment Advisers Registration Act, introduced by Congressman Paul E. Kanjorski (D-PA), Chairman of the House Financial Services Subcommittee on Capital Markets, Insurance, and Government Sponsored Enterprises. The Committee passed H.R. 3818 by a vote of 67-1.
The press release summarizes the bill as...
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Defining An Accredited Investor
One of the key rules for private investment funds is that their investors generally need to be “accredited investors.” This is the gateway to an exemption from the registration requirement under the federal securities laws.
The exemption is generally targeted so that experienced investors with significant financial resources and their own advisers are in...
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Update on the European Directive to Regulate Alternative Investment Fund Managers
The draft Directive on Alternative Investment Fund Managers was published on April 30, 2009. The Proposed Directive has been subject to lots of criticism. Many of the provisions in the Proposed Directive misunderstood the characteristics of different types of alternative investment funds.
It now seems the Proposed Directive will be implemented in one form...
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More on the Private Fund Investment Advisers Registration Act of 2009
There are three and half bills in Congress for regulating private investment funds. The Hedge Fund Adviser Registration Act of 2009, the Hedge Fund Transparency Act of 2009 and the Private Fund Transparency Act of 2009 are all sitting in committee. The half is the proposal from the Obama administration: Private Fund Investment Advisers...
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