The Hedge Fund Law Report

The definitive source of actionable intelligence on hedge fund law and regulation

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By Topic: Identity Theft

  • From Vol. 6 No.17 (Apr. 25, 2013)

    New SEC and CFTC Rules Require Certain Hedge Fund Managers to Establish Policies and Procedures to Combat Identity Theft

    On April 10, 2013, the SEC and the U.S. Commodity Futures Trading Commission (CFTC) jointly adopted rules to require certain hedge fund managers and other financial institutions to implement programs designed to detect and address identity theft, which is “fraud committed or attempted using the identifying information of another person without authority.”  More specifically, certain hedge fund managers that are registered or required to be registered with the SEC as investment advisers, as well as certain commodity pool operators and commodity trading advisors (as defined in CFTC regulations) will be subject to the new identity theft rules.  See “CPO Compliance Series: Registration Obligations of Principals and Associated Persons (Part Three of Three),” The Hedge Fund Law Report, Vol. 6, No. 6 (Feb. 7, 2013).  SEC Commissioner Luis Aguilar recently observed, “investment advisers registered under the Investment Adviser Act, particularly the private fund and hedge fund advisers that are recent registrants with the SEC, might not have existing identity theft red-flag programs, and will need to pay particular attention to the rules being adopted.”  This article discusses: (1) which hedge fund managers will be subject to the new rules; (2) the required elements of identity theft programs; and (3) some steps that covered entities must take to administer their identity theft programs.

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