Statement on Form PF

Today, the Commission is considering amendments to Form PF — a form that came about after the financial crisis in 2008.

We’d had challenges in private funds previously. So after the financial crisis in 2008, Congress came along and said, it’s time for us to collect information and share it with the newly formed Financial Stability Oversight Council.

I think we’ve learned a great deal since then. I support today’s proposal because, if adopted, it would help federal regulators to assess systemic risk, including the Financial Stability Oversight Council, the SEC, the Federal Reserve Board, and others. It also would bolster the Commission’s oversight of private fund advisers and the protection of investors in those funds.

Form PF, adopted in 2011, sheds light on a growing part of the financial sector that was not transparent to regulators: these private funds. Form PF provides the Commission and FSOC with important, confidential information about the basic operations and strategies of private funds and has helped establish a baseline picture of the private fund industry for use in assessing systemic risk. 

Since the adoption of Form PF in 2011, a lot has changed. In that time, the private fund industry has grown in size to a net asset value $11 trillion and evolved in terms of business practices, complexity of fund structures, and investment strategies and exposures.

The Commission and FSOC now have almost a decade of experience analyzing the information collected on Form PF. We have identified significant information gaps and situations where we would benefit from additional information. For example, we would benefit from more timely information during fast-moving market events such as the March 2020 dysfunction in the Treasury market.

Thus, this proposal does three things. First, the proposal would require certain advisers to hedge funds and private equity funds to provide current reporting of events that could be relevant to financial stability and investor protection, such as extraordinary investment losses or significant margin and counterparty default events. Second, the proposal would update the periodic reporting by large private equity advisers. Third, the proposal would update reporting by large liquidity fund advisers to correspond with reporting the Commission recently proposed for money market funds.

I’m pleased to support today’s proposal and, subject to Commission approval, look forward to the public’s feedback.

Looking ahead, I have asked staff to work jointly with staff at the Commodity Futures Trading Commission to consider whether they would recommend amending the joint portions of Form PF. I’d like to thank our colleagues at FSOC, the CFTC, the Department of the Treasury, and the Federal Reserve Board for their assistance. I’d also like to extend my gratitude to the members of the SEC staff who worked on this rule, including:

• William Birdthistle, Sarah ten Siethoff, Melissa Gainor, Michael Neus, Samuel Thomas, Lawrence Pace, and Alexis Palascak, Timothy Husson, Jon Hertzke, Roberta Ufford, Timothy Dulaney, Michelle Beck, David Stevens, Kevin Treharne, Viktoria Baklanova, Trevor Tatum in the Division of Investment Management;
• Meridith Mitchell, Marie-Louise Huth, Natalie Shioji, Monica Lilly, Cathy Ahn in the Office of the General Counsel;
• Jessica Wachter, Ross Askanazi, Alexander Schiller, Daniel Hiltgen, Charles Woodworth, Marina Martynova in the Division of Economic and Risk Analysis;
• Christopher Mulligan and Daniel Faigus in the Division of Examinations;
• Adam Aderton, Dabney O’Riordan and Daniel Pines in the Division of Enforcement; and
• Michelle Danis in the Division of Trading and Markets.