PANews October 16 news, according to Bloomberg, former U.S. SEC Chairman Arthur Levitt Jr. published an article criticizing the SEC's recently released proposal on retailization of private markets. Under the proposal, managers of private equity, venture capital, and other funds would find it easier to attract retail investor capital, and could establish multiple share classes in closed-end funds without prior regulatory approval. Levitt pointed out that the proposal does not require managers to adjust or standardize fees, liquidity, transparency, governance, and valuation arrangements, and retail investors may be assigned to high-fee share classes. He suggested that the SEC require third-party valuation of assets used to calculate performance-based fees, and require funds to use charts in their offering prospectuses to show the impact of fees on investment returns.
Former SEC Chairman Arthur Levitt criticizes the SEC's proposal to allow retail access to private markets.
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