Although the SEC is undergoing a period of transition with a new Chairman and co-heads of the Enforcement Division, the message is the same. That is, its day-to-day priorities remain the same, and it will bring more cases.
In particular, the private equity area is “ripe for action” given the way funds are structured and the current challenging economic conditions. Further, enforcement actions against investment advisers will only become more rigorous in the years ahead. Over the last two years, there has been a significant increase of actions against investment advisers. The SEC’s institutional focus on asset management firms, its whistleblower and cooperation initiatives, and the Enforcement Division’s new emphasis on “proactive detection.” In the private equity space, this activity all translates into more enforcement actions.
Thus, SEC actions will continue in these areas.