April 23, 2022
Saturday, April 23, 2022
Vanessa A. Countryman
Secretary
Securities and Exchange Commission
100 F Street NE
Washington, DC 20549-1090
Subject: Adopt New Protections for Investors against Wall Street Private Equity -- Private Fund Advisers Documentation of Registered Investment Adviser Compliance Reviews (Docket S7-03-22)
To Securities and Exchange Commission Chair
Misleading information about costs and inflated returns allows private equity funds to siphon hundreds of billions of hard-earned dollars from retirees and use them to undermine the livelihood and well-being of workers and their communities.
Put simply, Wall Street has figured out how to use money saved by current and future retirees to supercharge a business model that makes executives rich but destroys once-thriving companies.
Toys R Us is a poster child of what happens when private equity firms operating in the darkeven for their own investorstake over retailers. Private equity firms Bain Capital and KKR siphoned off $464 million in fees and interest as they drove the company into bankruptcy. Because private equity firms do not fully disclose the fees they charge to investors, it took pension funds longer than it should have to realize the extent of the problem and speak out.
And one only needs to read the latest VICE reporting on PetSmart to see the horrifying consequences of private equity's greed play out in real-time: BC Partners has prioritized paying themselves handsomely while they continue to cut corners, harming pet care workers and animals alike. Understaffing is leading to freezers with dead animals while many workers are still making $12.50 per hourwithout healthcare benefitsas PetSmart records record profits from the pandemic pet boom.
Thank you for your recent proposal (File Number S7-03-22) to regulate private equity industry practices covering these critical areas of needed reform:
- Promoting greater transparency around the fees and expenses that investors pay, and opening the way to standardization of reporting, so that investors protect their returns from being captured by hidden costs
- Developing more transparent and comparable performance figures that would assist investors in making decisions about how to allocate capital
- Disclosing and prohibiting preferential treatment of some fund investors that leave others with the short end of the stick, Restricting waivers, including prohibiting waivers when appropriate, that free private fund managers from fiduciary duties and conflicts of interest
These proposals are a vital step forward for protecting investors from the misleading and dangerous practices of the private equity industry. Please, adopt these rules as proposed and protect the public from Wall Street's looting.
Thank you for your consideration of my comments. Please do NOT add my name to your mailing list. I will learn about future developments on this issue from other sources.
Sincerely,
Christopher Lish
San Rafael, CA