Life after Registration: What will the SEC Look for in your First Audit (Deloitte)

July 2012

KEYWORDS: Deloitte, SEC, Securities and Exchange Commission, Dodd-Frank Act, Title IV of Dodd-Frank, Office of Compliance Inspections and Examinations, OCIE, investment adviser, assets under management, hedge funds, private fund advisers, registered advisers


Sam Auxier, Michael Chung, Jeannette Lewis

  • Deloitte


After years of operating relatively free from regulatory scrutiny, many of the world’s top hedge fund and private equity advisers now have to submit to oversight by the Securities and Exchange Commission’s (SEC’s) Office of Compliance Inspections and Examinations (OCIE). Fund advisers’ new status stems from Title IV of the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act), which repealed the registration exemption for private fund advisers in a bid to help regulators reduce the potential for fraud and get a focused view of systemic risks in the financial services sector. Between the Dodd-Frank Act’s enactment in 2010 and the March 30, 2012, registration deadline, the number of registered private fund advisers jumped 52 percent.

  • Of the 4,000 private fund investment advisers that manage one or more private funds, 34 percent are newly registered with the SEC. Registered private fund advisers represent approximately 30,000 private funds with $8 trillion in total assets under management.
  • For these new registrants, the coming months and years will likely find them responding to information requests from OCIE, if not on-site visits and interviews.

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