In October 2011, the Securities and Exchange Commission (“SEC”) adopted Rule 204(b)-1 under the Investment Advisers Act of 1940 to require registered investment advisers (“RIAs”) that advise more than $150 million in assets under management to periodically file Form PF. 

The purpose of this form as stated by the SEC is “not to reflect determination as to where systemic risk exists but rather to provide empirical data to the Financial Stability Oversight Council (FOSC) with which it may make a determination about the extent to which activities of private funds or their advisers pose such risk.”

Whew, that was a mouthful.  So in laymen terms, the use of this information is to get a better understanding of where the next MADOFF scheme might be lurking. Of course, my understanding was that the SEC had made inquiry into Madoff’s company and didn’t see anything wrong.  Oh well, now the PF form will give better identification as to where all the money is or should be.

Let’s take a look at the Form PF.  It is a 42 page document broken down into 5 sections.  All filers must complete Section 1.  Large hedge fund advisers (having assets under management of more than $1.5 billion) will complete Section 2.  Large liquidity fund advisers, those with at least $1 billion in combined money market and liquidity fund assets under management, will complete section 3.   Large private equity advisers, those with at least $2 billion in private equity fund assets under management, will complete section 4.  Section 5 is for advisers requesting a temporary hardship exemption.

Most private fund advisers, including large private equity advisers and smaller private fund advisers, are required to file Form PF only once per fiscal year. Large hedge fund advisers and large liquidity fund advisers, on the other hand, will need to update information relating to their funds each fiscal quarter.

If the advisers have assets under management of more than $5 billion, filing dates to be aware of are as follows (assuming a calendar fiscal year end):

Hedge fund advisers                      August 29, 2012

Liquidity fund advisers                   July 15, 2012

Private equity advisers                  April 30, 2012


For RIAs that manage at least $150 million in private funds but less than $5 billion, the due date would be filed for the first period ending December 31, 2012, with due dates in 2013 depending on the type of adviser.


My partner Matt Pribila, who heads up our Hedge Fund Services Team is working on a more comprehensive summary of this new form which will be available soon.


1 reply

  1. Once again the government trying to show their deep concern for the American people. Must be an election year. Did anyone see reports from auditors on Madoff? Did those auditors and regulatory people turn a blind eye. Of course. There was policy, procedures and protocol in place long before this newest piece of protection came out. This enitire financial scrutiny and all these repetitive handcuffs are because the government and other agencies failed at there job. So what else is there to do then throw up more smoke and mirrors and show how the govenment will protect against all these financial wolfs. Just another waste of time for the industry to do to help elect some figurehead interested only in power and not really for the people. Financial institutions have been demonized and scapegoated because of the failure or the govenment to properly do their jobs. What a joke.

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