Regulatory Forum

On September 14, 2026, the SEC's Division of Examinations published a Risk Alert summarizing staff observations from recent examinations regarding investment advisers' annual reviews of their compliance policies and procedures under Rule 206(4)-7. The Division identified recurring issues with the timeliness of reviews, the completeness of review procedures, alignment between policies and actual practices, documentation, and follow through on corrective actions. Our latest client alert outlines the specific deficiencies the staff identified, what this means for RIAs and their CCOs, and how Standish can help firms ensure their annual review process meets SEC standards before their next examination.

The SEC has proposed to rescind Rule 206(4)-5, the Investment Advisers Act's Pay-to-Play Rule, after concluding that its strict liability framework created disproportionate consequences relative to the rule's anti-corruption goals. This is a significant development for investment advisers and private fund managers. If adopted, the rescission would eliminate the two-year compensation ban and related recordkeeping requirements, leaving existing antifraud, fiduciary duty, and compliance obligations in place. The proposal is open for public comment for at least 60 days. We will continue to monitor this proposal and will update you on further developments. Please see the attached summary for more detail.

The SEC voted to further extend the compliance date for the 2024 Form PF amendment to July 1, 2027, to provide time to conclude consideration of final amendments to the form. Following the last extension, the SEC proposed additional amendments to Form PF to tailor private fund reporting requirements while ensuring the continued collection of necessary and appropriate information. Chairman, Paul Atkins noted that SEC staff have been carefully reviewing the comments submitted in response to the amendments, and they are making great progress. However, he expressed that given the importance of this information collection effort and its technical nature, a short extension is practical and necessary. This means that annual Form PF will still be required of all RIAs with more than $150 million in private fund AUM by April 30, 2027 and that quarterly Form PFs will continue to be required for large hedge funds with more than $1.5 billion in hedge fund AUM through Q1 2027. In addition, material event disclosures will continue to be required in their current form on Section 5 for large hedge funds within 72 hours of the triggering event and on Section 6 for all private equity funds within 60 days after end of the applicable quarter. We expect that once final amendments to Form PF are adopted, the filing thresholds will increase to $1 billion for all private fund managers and $10 billion for large hedge fund managers so that smaller private fund managers would be exempt from the filing. As a reminder, if adopted as proposed, current event disclosures for large hedge funds will be scaled back, and private equity funds would no longer be subject to such disclosures.