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Statement on Amendments to Form PF

May 3, 2023

It has been over a year since the Commission first proposed the amendments to Form PF that we seek to adopt today.[1] And, what a difference a year makes.[2] Since the filing of the proposal, we have seen a major geopolitical crisis unfold as Russia invaded Ukraine;[3] the U.S. Federal Reserve raised interest rates by nearly 5 percent;[4] and, we have witnessed the unraveling of three regional U.S. banks and one international financial institution, compelling government intervention to stem turbulence, losses, and to promote market confidence.[5],[6]

And, in parallel during that time, U.S. private funds have taken an even more prodigious position in our markets. As Chair Gensler pointed out in a speech yesterday, advisers now report more than $25 trillion in private fund gross asset value, surpassing the banking industry.[7] And, based on the data we had one year ago as compared to the most current data we have today, in the past year alone:

  • The number of Form PF reported private funds increased by over 6,000;[8]
  • The aggregate private fund gross asset value increased by approximately $1.8 trillion;[9] and
  • Retirement money invested in private funds through public and private pensions went up by approximately $286 billion.[10]

Now, none of the events I note here happens in a vacuum. Our interconnected world and financial markets mean that events that benefit or stress one financial institution may impact affiliates, counterparties, competitors, joint venture partners, peers, or investment strategies that co-exist time zones away. And while some of the aforementioned current events continue to unfold, they already serve to provide valuable lessons. Perhaps most poignantly for us today—providing the right regulators with timely and critical information in times of market stress or volatility can stem the tides on a potential crisis and help prevent investor harm; and, providing regulators with the right information before times of stress can be prophylactic.

Congress has given this agency the authority to mandate that investment advisers to private funds—this multi-trillion dollar industry—provide us with information that the Commission deems “necessary and appropriate in the public interest and for the protection of investors or for the assessment of systemic risk.”[11] Congress has put tools at our disposal and we must deploy them. And, that is why I am happy to support today’s amendments.[12]


The utility of Form PF should not be understated. The statistics I just read on the private funds industry were brought to us courtesy of data collected on Form PF. But, of course, the utility of the material goes far beyond my brief use of these statistics in a statement. The data collected on Form PF help us assess systemic risk, market weaknesses, and potential areas for investor harm. With this information, the staff has developed valuable tools to help identify and assess market trends, such as trends relating to liquidity, borrowing, leverage, the use of derivatives and high frequency trading, and exposure to certain risky products or markets. The Commission analyzes these data to inform policy and rulemaking; to help respond to registrant, market, or geopolitical events; to make the best use of our agency’s limited resources; and, to maximize our investor protection functions. The data are also shared with FSOC for its use in the assessment of systemic risk.[13]

Today’s adoption amends Form PF to gather additional pertinent information. Large hedge fund advisers to qualifying hedge funds will have to file contemporaneous reports relating to significant events that have the potential for broad impacts or investor loss. Those events include, among others: extraordinary fund losses, significant margin and default events by funds or their counterparties, termination or material restrictions in prime brokerage relationships, the inability to satisfy withdrawals, and suspension of redemptions. We are also requiring new quarterly reporting for private equity advisers relating to their adviser-led secondary transactions and investor elections to remove a fund’s general partner or terminate the investment period or life of a fund. This new information will not only help us assess trends, but potentially provide us with a roadmap during times of crisis or significant investor harm.

As our private fund industry grows in prominence, investor confidence in the integrity and stability of this industry must grow in tandem. But integrity and stability require some oversight and built-in protections. Today’s final rule is a step in the right direction of bringing additional, much needed transparency into this outsized, but largely opaque, part of the market.

I am indebted to the team in the Division of Investment Management that worked on today’s adopting release. Thank you for your thoughtfulness, guidance and hard work on this rule. Thank you also to the industrious staff in the Division of Economic and Risk Analysis, the Office of the General Counsel, the Office of the Secretary, the Office of Information Technology, the Chair’s Office, the offices of my fellow Commissioners, and to all of the staff who contributed. I am pleased to support this adoption.

[2] See generally Dinah Washington, “What a Diff’rence a Day Makes,” Mercury (1959).

[3] See, Matthew Mpoke Bigg, How Russia’s War in Ukraine Has Unfolded, Month by Month, N.Y. Times (Feb. 24, 2023).

[4] See Nick Timiraos, Fed Set to Raise Interest Rates to 16-Year High and Debate a Pause, Wall St. Journal (May 1, 2023).

[5] See Michael Barbaro and Jeanna Smialek, A Third Bank Implodes. Now What?, The Daily Podcast, NY Times (May 2, 2023).

[6] Arash Massoudi, Stephen Morris, James Fontanella-Khan, Laura Noonan and Owen Walker, UBS Agrees to Buy Credit Suisse for More Than $2 Billion, Financial Times (March 19, 2023).

[7] Chair Gary Gensler, “The ‘90s: Rom-coms, the Spice Girls, & MFA:” Remarks Before the Managed Funds Association (May 2, 2023) at nn. 2-4 and accompanying text (reflecting data from Form ADV filings through March 31, 2023, including registered investment adviser GAV and exempt reporting adviser GAV, less estimated overlap).

[8] See SEC Division of Investment Management Analytics Office, Private Fund Statistics, Third Calendar Quarter 2022 (April 6, 2023) at Table 1 (comparing 2021 Q3 to 2022 Q3).

[9] Id. Table 3.

[10] Id. Table 13 (including listed values for “State/Muni. Gov’t Pension Plans” and “Pension Plans”).

[11] 15 U.S.C. § 80b-4(b)(5).

[12] Adopting Release, Amendments to Form PF to Require Event Reporting for Large Hedge Fund Advisers and Private Equity Fund Advisers and to Amend Reporting Requirements for Large Private Equity Fund Advisers, Rel. No. IA-6297 (May 3, 2023).

[13] U.S. Securities & Exchange Commission, Annual Staff Report Relating to the Use of Form PF Data (Dec. 9, 2022).

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