Publications

- June 1, 2017: Vol. 29, Number 6

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Expense management: Why you should review your operating agreements

by Paige Mueller

The Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 intended to improve accountability and transparency in the financial system and protect consumers from abusive financial services practices, among other goals. One result of the act was increased registration with the Securities and Exchange Commission by private equity firms, including many real estate firms. As the industry continues to evolve in a new era of SEC compliance, SEC findings are providing new transparency in investment firm policies regarding expense and fee management, some of which are highly detrimental to investors.

In 2016, the SEC filed a record number of enforcement actions, resulting in disgorgement and penalty fees of more than $4 billion — and these fines are not insignificant. Penalty fees against individual firms have run into the hundreds of millions of dollars. One of the key focuses of recent SEC activity has been to uncover misconduct by investment advisers and investment co

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