Brian Forman Quoted in Compliance Week on Federal Court Decision to Strike Down SEC Private Fund Adviser Rule

Partner Brian Forman was quoted in a Compliance Week article entitled “Court Overturns SEC Private Fund Adviser Rule, Calls Out Agency Overreach.” The article discussed the unanimous decision by the U.S. Court of Appeals for the Fifth Circuit to strike down the Securities and Exchange Commission’s (SEC) private fund adviser rule, agreeing with industry advocates that the agency overstepped its authority. The court ruled that Congress must explicitly give the SEC the authority to regulate private funds.

Brian, who chairs Morrison Cohen’s Investment Funds & Advisers Practice, said that much of the existing rule “was unnecessary and could have been enforced by the SEC under existing anti-fraud concepts, which the industry commented about significantly during the comment phase.” He added, however, that “the text of the final rule still provides a lot of insight into what the SEC views as best practices, and we should still be mindful of it as an industry.” In addition, he cautioned clients to be “wary of increased enforcement under anti-fraud rules.”

Read the full article here.