The sweeping regulatory changes instituted under Dodd-Frank have had a significant impact on investment advisers of all types, especially those who manage private investment funds such as hedge funds. Many who were previously exempt from registration under the Investment Advisers Act of 1940 are now required to register with the SEC. Additionally, many are now subject to increased reporting requirements.
The SEC’s Office of Compliance Inspections and Examinations has stepped up its efforts to examine investment advisers’ compliance policies and procedures. These examinations are often conducted with very little notice. If your compliance program is found to be lacking, you may face action by the SEC’s Enforcement Division. If OCIE comes knocking on your door, will you be able to demonstrate that your compliance program is in order?