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Securities Compliance Sentinel Analysis of cutting-edge securities industry issues

You Have to Make Sure Your Private Equity Firm Has D&O Coverage When Responding to Subpoenas

Posted in Compliance and Supervision, Federal and State Criminal Activities, Hedge and Private Equity Funds, SEC Enforcement, Securities Litigation, State Enforcement

Private equity companies have recently been hit with a barrage of regulatory subpoenas.

Responding to these subpoenas may cost the private equity firms to expend millions of dollars.  These entities should have D&O liability insurance.  Initially, the entity must make sure that responding to such a subpoena falls within the definition of a claim.  Some policies may not define claim so you may then have to hope that the court reviewing your matter accepts a definition that will encompass a response to the subpoena.

Essentially, be prepared before receiving the subpeona, call your insurance broker (and lawyer) today!