Focus Increasing on Alternative Investment Vehicles in Washington

July 10, 2007

Tomorrow, Wednesday, July 11th, the U.S. Securities and Exchange Commission will hold an open meeting to consider the adoption of a new rule that would “prohibit advisers to certain pooled investment vehicles[, including hedge funds and private equity funds,] from making false or misleading statements to, or otherwise defrauding, investors or prospective investors in those pooled vehicles.”

As we have reported previously, the rule, which was proposed by the SEC last December, would create a new antifraud provision under the Investment Advisers Act of 1940. It would apply to all investment advisers, whether registered or unregistered, to hedge funds and other pooled investment vehicles. Under the proposed rule, a pooled investment vehicle would include any investment company and any company that would be an investment company but for the exclusions in sections 3(c)(1) or 3(c)(7) of the Investment Company Act.

For more information about this e-Alert, please contact Tony Perricone, Chair, Fund Services Group (212.398.5290 or aperricone@sonnenschein.com), Mike McNamara, Chair, Public Law & Policy Strategies Group (202.408.6477 or mmcnamara@sonnenschein.com) or your regular Sonnenschein contact.

Click here to read the e-Alert.


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