Julie Riewe, Co-Chief, Asset Management Unit (AMU) for the Division of Enforcement of the Securities and Exchange Commission, discussed the priorities for AMU during IA Watch’s 17th annual Investment Adviser Compliance Conference in Washington, DC, last week. Principal among the AMU’s enforcement priorities are to ensure that all advisers discharge their “fiduciary obligation” to identify conflicts of interests and to “mitigate them and disclose their existence to boards or investors.” Among the specific conflicts AMU identified in recent enforcement actions were failure to obtain best execution, by registered funds; principal transactions without obligatory written disclosure and consent, by hedge funds; and fee and expense arrangements, by private funds (e.g., an adviser misallocating expenses to funds it managed). Ms. Riewe claimed that, among registered investment advisers, the most significant conflicts of interest involve improper principal transactions, the failure of best execution by related broker-dealers and non-disclosed compensation arrangements. According to Ms. Riewe, going forward AMU will “recommend a number of conflicts cases for enforcement action, including matters involving best execution failures in the share class context, undisclosed outside business activities, related-party transactions, fee and expense misallocation issues in the private fund context, and undisclosed bias toward proprietary products and investments.”