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SEC Risk Alert Highlights Compliance Issues Relating to Investment Adviser Principal and Agency Cross Transactions

09.12.19
Last week, the Office of Compliance Inspections and Examinations (“OCIE”) of the U.S. Securities and Exchange Commission (“SEC”) published a Risk Alert (the “Risk Alert”) highlighting compliance issues identified in investment adviser exams relating to principal trading and agency cross transactions under Section 206(3) of the Investment Advisers Act of 1940 (the “Advisers Act”). This memorandum outlines the Section 206(3) compliance issues identified in the Risk Alert and highlights some key takeaways for investment advisers that manage private funds.