Brian Daly Quoted in Hedge Fund Alert on SEC’s Enforcement Priorities

Akin Gump investment management regulatory and compliance partner Brian Daly has been quoted in the Hedge Fund Alert article 'SPACs, ESG Claims, Transparency in SEC Crosshairs as Enforcement Ramps Up.'

The article reports that the Securities and Exchange Commission's Division of Examinations has added environmental, social and governance policies of registered investment advisers to its examination priorities. Earlier this year, the article notes, the Division said it would review the consistency and adequacy of ESG-related disclosures that fund managers and sponsors provide to investors. As a result, the article says, hedge fund lawyers have been poring over their clients' Form ADVs, marketing documents, private-placement memoranda and informal investor communications.

'In the asset-management space,' said Daly, 'the focus is going to be among managers who are holding themselves out across the board as being in tune with ESG requests coming in from investors.'

Another area of focus for the SEC, according to the article, is how hedge funds search for and use data from non-traditional sources. The Division of Examinations, Hedge Fund Alert says, has stated that examinations will review whether firms are implementing appropriate controls and compliance around the creation, receipt and use of such information.

Daly observed that, at some point, 'we should expect the SEC will put out additional guidance' in the form of a risk alert.