On August 23, 2023, the U.S. Securities and Exchange Commission (“SEC”) implemented heavily anticipated private fund reforms (the “Private Funds Rules” or the “Rules”) promulgated under the Investment Advisers Act of 1940, as amended (the “Advisers Act”). Although the Rules are far less “mandate-driven” than those originally proposed in February 2022, the Rules nevertheless impose significant disclosure (and in some cases, operational) requirements that all …
The “WTH is an NFT?” Series – Part 1
Introduction In the past 18 months the NFT phenomenon has fully entered the public consciousness. And like any new blockchain phenomenon, the immediate questions range from is this “legal” to how do we raise money with it? As a securities firm, our focus is often on the use of blockchain for fundraising activities and when, why, and how those activities may be governed by extant …
Legal Help for How to Form a Venture Capital Fund
When you’re beginning to form a venture capital fund, you will want the expertise of Riveles Law Group in New York by your side. We have experience in providing comprehensive legal counsel to those seeking to form venture capital funds. We represent venture funds focuses on start-up technology in 3D printing, mobile apps, digital marketing, robotics, health tech, and even artificial intelligence, to name a …
How to Start a Real Estate Fund
When it comes to investments, we at the Riveles Law Group can offer expert legal counsel to those interested in learning more about how to start a real estate fund. These real estate funds are used to diversify one’s long-term investment portfolio in New York. A real estate fund is a type of mutual fund that focuses on investing directly in securities that are offered …
What Is a Private Equity Fund Law Firm?
At the Riveles Law Group, we have experience in forming private equity funds with various investment strategies in New York. Whether start-up technology, renewable energy, real estate, oil and gas, or debt financing; our private equity fund law firm can work with managerial staff to develop these structures. During the development stage, we take into account various things such as securities laws, cross-border investment issues, …
Hire a New York Hedge Fund Attorney Today
As a hedge fund attorney group, Riveles Law Group has years of experience counseling managerial staff in all parts of fund formation or structuring as well as compliance requirements. Our attorneys are committed to helping our clients to launch their businesses as well as to navigate the ever-changing landscape. We represent a large range of hedge funds with assets from 1 million and beyond while …
How to Start a Crypto Hedge Fund in New York
While hedge funds have been a popular choice for those not looking for much risk in terms of investing, the newest investment option is known as a crypto hedge fund. A hedge fund is a way for a person to invest a large group of securities which is managed by expert investors. At this time, there are two different types of cryptocurrency hedge funds: those …
The New Change in ERISA’s “Fiduciary” Definition and its Effect on Private Fund Managers
Broadened Scope of ERISA Fiduciary Rules After several years of debate and revision, a Department of Labor (DOL) regulation, revising the definition of a “fiduciary” as it applied to investment managers, became applicable on June 9, 2017. The new regulation expands the definition of “fiduciary” under the Employee Retirement Income Security Act of 1974 (ERISA) and the Internal Revenue Code of 1986, as amended, to …
Silicon Valley VC Seeks to Crowdfund 100mm with JOBS Act
500 Startups, a Silicon Valley venture capital fund known for its startup incubator, said on Thursday it would generally solicit investments from the public for its third fund. Prior to the JOBS Act going into effect last year, 500’s attempt to generally solicit the public would have drawn the ire of the Securities & Exchange Commission. Now, the Act’s general solicitation provision allows private funds—500 …
Newly Created “Capital Acquisition Broker” Rule Reduces Regulatory Burdens on Some Broker-Dealers
By Greg Caramenico and Lauren Mack On August 18th, the Securities and Exchange Commission (“SEC”) approved a Financial Industry Regulatory Authority Inc. (“FINRA”) rule that establishes less burdensome regulations for “Capital Acquisition Brokers” (“CABs”), which are a subclass of broker-dealers that engage only in limited activities. CABs can elect to be governed by the new rules by converting their current FINRA membership or by submitting a new …
Federal Courts Now Available for Trade Secret Misappropriation Claims
By Lauren Mack On May 11, 2016, President Obama publicly signed into law the Defend Trade Secrets Act (the “DTSA”), a long anticipated piece of legislation that creates a federal cause of action for trade secret misappropriation claims. Unlike claims of copyright, trademark, and patent infringement, trade secret misappropriation claims could not be brought by plaintiffs in federal court until now. What Are Trade Secrets? …
Debate Over Accredited Investor Definition Gaining Momentum
Discussions surrounding the accredited investor definition have crescendoed of late, demonstrating a sharp divide in opinion among regulators. On one side lies the North American Securities Administrators Association (“NASAA”), the lobbying group that represents the state securities administrators. The NASAA published a comment letter on the definition on May 25, 2016, evidencing a highly conservative approach.[1] The group relies on investor protection concerns in calling …
SEC Issues Notice of Intent to Raise Net Worth Threshold for Qualified Clients
By William Kelly and Simon Riveles On May 24, 2016, the Securities and Exchange Commission (“SEC”) published a notice of its intent to issue an order increasing the net worth threshold for “qualified clients,” as defined in Rule 205-3 under the Investment Advisers Act of 1940, as amended (the “Advisers Act”). The Advisers Act generally prohibits SEC-registered investment advisers from charging any client a performance-based …
Which Regulation D Exemption is Suitable for Your Venture?
By Lauren Mack Companies seeking to raise capital – whether through selling equity, convertible notes, or any other security – in the United States must navigate a complex landscape of securities laws and regulations. They are subject not only to federal regulations, but also the laws of each state in which an investor (or soon-to-be investor) resides. The general rule under federal law is that …
SEC Staff Issues Report and Recommendations in Connection with Changes to the Accredited Investor Standard
By William Kelly and Simon Riveles On December 18, the SEC staff issued a report summarizing its review of the accredited investor definition. The report offers historical and current analyses of the definition, evaluates relevant comments on and suggested modifications to the definition, and considers alternative approaches under federal and state securities laws for identifying financially sophisticated investors. The report concludes with SEC staff recommendations …
CFTC Approves NFA Cybersecurity Interpretive Notice
By William Kelly Acknowledging the rapid evolution of information technology and correspondent threats, on August 20, 2015 the National Futures Association (“NFA”) issued an Interpretive Notice addressing cybersecurity concerns. The Interpretive Notice established general requirements relating to the information systems security programs (“ISSPs”) of futures commission merchants, commodity trading advisors, commodity pool operators, introducing brokers, retail foreign exchange dealers, swap dealers, and major swap participants …
Proposed IRS Regulations Target Management Fee Waivers in Exchange for Partnership Interests
By Lauren Mack On July 22, 2015, the IRS issued a notice of proposed rulemaking regarding the classification of management fee waivers in exchange for partnership interests as disguised payment for services. Under the proposed regulations, allocations of income to partners that provide services to the partnership that lack “significant entrepreneurial risk” will be recharacterized by the IRS as payments for services. Background In 1984, …
FinCEN Proposes Long-Expected AML Rule for Investment Advisers
By William Kelly On August 25th, the Treasury Department’s Financial Crimes Enforcement Network (“FinCEN”) proposed a new rule applicable to investment advisers. At its core, the proposal seeks to extend anti-money laundering (“AML”) obligations imposed under the Bank Secrecy Act (“BSA”) to registered investment advisers. This proposal comes as little surprise, as the Treasury Department has long contemplated the extension of AML regulations to investments …
SEC Issues New Guidance on General Solicitation and Advertising in Regulation D Offerings
By Lauren Mack On August 6, 2015, the SEC’s Division of Corporation Finance (“DCF”) updated its Compliance and Disclosure Interpretations (“CDI”) with eleven new CDI on general solicitation and advertising in Regulation D offerings. That same day, the DCF also issued a no-action letter finding that an online venture capital firm’s procedures for creating online pre-existing substantial relationships did not constitute general solicitation and advertising …
AIFMD and Potential Extension of the EU Passport to the U.S
By Lauren Mack and Simon Riveles The Alternative Investment Fund Managers Directive (“AIFMD”) governs Alternative Investment Fund Managers (“AIFMs”) and Alternative Investment Funds (“AIFs”) in the European Union (“EU”) and seeks to harmonize the applicable regulations throughout the member states of the EU. Among its regulations are two different paths that AIFMs planning to market to EU investors may take: (a) minimum requirements for the …