On November 4, 2022, compliance with amended Rule 206(4)-1 (the “Marketing Rule”) became mandatory for all investment advisers registered with the Securities and Exchange Commission (the “SEC”).[1] Seven months since the compliance date, SEC-registered investment advisers continue to discover and adapt to challenges in applying the Marketing Rule. Newly formed advisers also face significant
Massimo B. Capizzi
Max Capizzi is an associate in the Litigation Department.
Max earned his J.D., cum laude, from the University of Michigan Law School, where he was a senior editor of the Michigan Law Review and a teaching assistant for the first-year legal writing program. While in law school, Max interned at the U.S. Attorney’s Office for the District of Columbia and participated in Michigan’s Civil-Criminal Litigation Clinic. Max holds a B.A., magna cum laude, from Georgetown University.
The Trend Continues: Increased Regulatory Focus on Privacy & Cybersecurity for Private Funds
Recent enforcement actions highlight the increased regulatory scrutiny that private funds may face with respect to internal cybersecurity protocols and responses to cyber-crimes and cyber incidents under new and updated cybersecurity laws.
In January 2023, the New York Department of Financial Services (DFS) announced sanctions against Coinbase, finding “significant failings in the company’s compliance program.” …
Regulators’ Increased Focus on GP-Led Secondaries and Continuation Funds
As IPOs and other traditional paths to liquidity for private assets have become more challenging, GP-led secondary transactions have emerged as a powerful and popular tool across closed-end private funds, leading to explosive growth over the last five years. And while macro factors influence their prevalence year over year, these transactions remain broadly popular across the…
Energy Transition: A New Risk Climate for Investors
Go to any private equity event in the last 12 months, and “energy transition” will have been discussed, meaning the shift in energy production away from fossil‑based systems to low or zero carbon ones. As fund managers continue to raise funds focused on investments in this sector, we see no reason for this trend to…
Ripples Following the SPAC Wave: Litigation and Regulatory Risks
It’s a pattern we often see in boom-and-bust cycles—disputes rising in the period after a wave crests. SPAC deal volume hit an unprecedented high in 2021, but then slowed down in 2022 alongside IPOs. However, the fallout from the SPAC wave will continue to unfold this year, generating increased regulatory attention and a growing number of…
Messaging Missteps: SEC’s Increasing Focus on Off-Channel Communications
The SEC’s Enforcement Division is conducting a sweep investigation of large investment advisers regarding their employees’ use of “off-channel” communications. The sweep, which has been widely reported in the press, focuses on text messages from personal phones, personal email, WhatsApp and other platforms not typically captured or monitored by advisers. The sweep is causing …
SEC Overreach:Insurers Underwrite?
The SEC spent 2022 making multiple and sweeping proposals to amend rules under the Advisers Act, many of which have the ability to significantly re-shape market standards for private funds. Here, we focus on the SEC’s proposal to undo a common protection for private fund advisers – the ability to rely, as against the…