Investment Advisers and Mutual Funds
Our practitioners have considerable experience representing investment advisers, hedge funds and mutual funds in SEC investigations and other regulatory inquiries. Sidley lawyers have defended advisers and funds in investigations involving, among other issues, alleged insider trading, short sales, market timing, services of adviser affiliates and advertising. Several of Sidley’s securities enforcement partners are former SEC officials.
We routinely team up with Sidley lawyers in other practices, such as Investment Funds, to provide preventative counseling in issues that commonly surface in government investigations, such as insider trading, information barriers, use of outside consultants, alleged manipulative practices, short sales and supervision.
A sampling of some of the recent matters in which Sidley’s enforcement lawyers have defended advisers and funds includes:
- Alleged Insider Trading - Sidley has defended several hedge fund advisers in SEC or FINRA inquiries or investigations involving allegations of possible insider trading. In a number of these matters, Sidley lawyers early on were able to convince regulators that the trading in question involved no misconduct, prompting the regulators to drop their inquiries.
- Short Sales - Sidley enforcement defense counsel recently represented a hedge fund adviser in an SEC investigation into whether the fund violated Exchange Act Rule 105 after shorting a stock in the “restricted period” before an offering.
- Market Timing - Sidley litigators have defended hedge fund advisers in investigations by the SEC, New York Attorney General’s office and FINRA involving allegations of improper market timing of mutual funds.
- Alleged Manipulation - Sidley litigators defended a hedge fund adviser in an SEC investigation involving whether certain of the fund’s NYSE trades were manipulative.
- Affiliated Brokerage - The firm has represented a mutual fund investment adviser in an SEC investigation into the fund’s use of an adviser affiliate to provide brokerage services for fund trades.
- Advertising - The firm is representing a hedge fund adviser in an FINRA investigation into whether certain of the fund’s literature violated FINRA advertising rules.