SEC Sets Sights On Hedge-Fund Compliance Officers

Jan 14 2014 | 12:49pm ET

The Securities and Exchange Commission has a new strategy for keeping hedge funds in line: holding their compliance officers responsible.

Hedge funds required to register with the regulator are also required to have a chief compliance officer. And, according to Schulte Roth & Zabel's Marc Elovitz, those new CCOs are expected to be doing their jobs.

"The SEC is being much more aggressive in charging compliance officers when there's a compliance failure," Marc Elovitz, a partner at the law firm, told The Wall Street Journal. "It puts compliance officers in hedge funds in the hot seat and puts huge pressure on these firms and their officers to have much better compliance."

Schulte Roth plans to discuss that matter and others related to hedge-fund regulation at its annual conference today.

The SEC brought several administrative proceedings against hedge-fund compliance officers last year, according to the Journal.


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