Conflicts From Managing Multiple Funds and Other Current Challenges to Effective Compliance at Hedge Funds (Part Two of Two)

With the SEC issuing a steady stream of statements promising enhanced scrutiny and new regulations, compliance professionals at private funds are scrambling to keep up. In addition to the Commission’s sharpened focus on environmental, social and governance (ESG) investing, market trends have also created new versions of familiar conflicts that compliance teams must address, even as a continued remote work environment for many firms forces compliance professionals to go above and beyond to oversee employees. Those and other issues were addressed in a Practising Law Institute panel moderated by Gibson Dunn partner Mark K. Schonfeld, which featured Eric M. Albert, CCO and legal counsel at Holocene Advisors, LP; Kenneth J. Burke, head of compliance and senior counsel at Vista Credit Partners Management, LLC; and Igor Rozenblit, founder and partner at Iron Road Partners and former Co‑Head of the SEC’s Private Funds Unit. This second article in a two-part series summarizes key takeaways from the discussion on current compliance challenges involving ESG investing and conflicts related to business expansion, as well as early goals for incoming CCOs. The first article covered the discussion of two recent enforcement actions involving insider trading and material nonpublic information and their implications for hedge fund managers. For additional insights from Rozenblit, see “Barbash, Breslow and Rozenblit Discuss Hedge Fund Allocations, Restructurings and Advisory Boards” (Apr. 7, 2016).

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