People leave the U.S. Securities and Exchange Commission SEC headquarters in Washington, D.C. on May 12, 2021. Picture taken on May 12, 2021. WASHINGTON, Jan. 26, Reuters - The U.S. Securities and Exchange Commission SEC will propose new rules on Wednesday to boost hedge fund and private equity disclosures, as it looks to increase oversight of the private funds industry and better monitor systemic risks.
Private funds must disclose details of material events within a business day, compared to the current quarterly or annual requirement, depending on the firm.
Private funds disclose purchases and sales of securities to the agency through Form PF.
The draft rule would reduce the Form PF reporting threshold for private equity advisers from $2 billion in assets under management to $1.5 billion in order to capture more firms.
The private funds industry was under scrutiny after hedge fund de-leveraging contributed to the turmoil in the U.S. Treasuries market in March 2020 and hedge funds were again at the center of the last year's GameStop GME.N meme-stock saga.
The data will not be publicly disclosed, but it will help regulators spot signs of trouble, such as big losses, significant margin and counterparty default events, material changes in prime broker relationships and other events associated with withdrawals and redemptions, the SEC said.