Regulatory Alerts2025-01-28
Added · Updated
SFC Circular on Deficiencies and Substandard Conduct in Private Fund and Discretionary Account Management
The Securities and Futures Commission issued a circular highlighting breaches by asset managers regarding conflicts of interest, risk management, and fair treatment of investors in private funds and discretionary accounts. The regulator mandates that asset managers strictly identify, prevent, and document conflicts, particularly when transacting with connected persons or receiving inducements, while ensuring arm's length terms and proper disclosures. Additionally, asset managers must implement robust risk management procedures to adhere to investment mandates, manage liquidity and credit risks, and treat all investors fairly during redemption processes.
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