New rules under the Investment Advisers Act of 1940 affect investment advisers depending on status

CFTC approves proposed rule regarding exemptions from certain requirements for commodity pool operators, commodity trading advisers and commodity pools

Relying on our years of pragmatic legal and business fund manager experience and know-how across the fund manager organization enterprise, we have executed a number of viable offshore start-up private fund vehicles for clients seeking to manage fund formation start-up costs and increase the likely-hood of the investment manager's short term fund formation and long-term hedge fund or private equity fund execution success. The decision where to form a private hedge fund or private equity fund, form of fund formation structure, how to execute the fund manager strategy, the use and management of offshore providers is critical and can offset a material portion of both the short term and long term variable and/or fixed private fund manager costs across regulatory, filing fees and offshore legal fees.

Under the prior definition of a QEP, certain persons (including natural persons who are accredited investors, among others) must meet one of two compliance thresholds or a combination of the two in a private fund.  The newly adopted Portfolio Requirement doubles the amounts of the two thresholds: The Securities Test will be set at $4 million and the Initial Margin and Premium Test will be set at $400,000 for commodity pooled private fund offerings and managed accounts trading in commodities

Effective October 1, 2024, Florida allows for both increased opportunities for Florida-based businesses to raise capital within Florida and strengthened licensing and anti-fraud provisions substantially revising Florida Securities and Investor Protection Act for Florida exemption of investment advisers and its private funds as well as forms and types of private fund offerings for exempt investment advisers to private funds

The court recently granted the US government’s request for an emergency stay of a nationwide preliminary injunction against the government’s enforcement of the Corporate Transparency Act (CTA) that was issued by the District Court for the Eastern District of Texas on December 3, 2024. The stay reintroduced the January 1, 2025 deadline for filings under the CTA for reporting companies formed prior to January 1, 2024. The Financial Crimes Enforcement Network (FinCEN) issued guidance extending the filing deadline to January 13, 2025 for most reporting companies.  Reporting companies before January 1, 2024 must file by January 13, 2025

• Reporting companies created/registered in the United States on or after September 4, 2024, and with a filing deadline between December 3, 2024 and December 23, 2024, must file by January 13, 2025
• Reporting companies created/registered in the United States between December 3, 2024 and December 23, 2024 will have an additional 21 days from their original deadline.
• Reporting companies created/registered on or after January 1, 2025 must file within 30 days of receiving notice that their creation/registration is effective
• Reporting companies qualifying for disaster relief may have deadlines extended beyond January 13, 2025, and should abide by whichever deadline falls later

If you require support or guidance on filing with the CTA please contact our office for guidance by emailing us at 0ffice@afundpllc.com Alternative Fund, PLLC, boutique legal and business matter law firm alternative to private fund managers across hedge funds, private equity and venture capital firms. C-suite executive and law firm experienced lawyers sets us apart with enterprise-wide business know-how working with conventional to complex private fund manager firms and the spectrum of asset classes. • Contact • If you have any questions, please contact us: www.afundpllc.com +1 917-558-7794 office@afundpllc.com  Attorney Advertising— Alternative Fund, PLLC provides this information as a service for educational purposes only. It should not be construed or relied on as legal advice or to create a lawyer-client relationship. Readers should not act upon this information without seeking advice from professional advisers.

For 2025, the Securities and Exchange Commission’s Division of Examinations announced its 2025 exam priorities for "registered" investment advisers. Next year’s examinations will prioritize areas such as fiduciary duties and standards of conduct for investment advisers, and cybersecurity, artificial intelligence (AI), and anti-money laundering (AML) for various market participants. In addition to conducting examinations in core areas such as disclosures and governance practices, the Division will also examine compliance with new rules.  The number of SEC investment adviser exams conducted each year has been steadily on the rise as the number of registrants has also increased. A brief summary of increased priorities for investment advisers below:  

Family offices are a source of capital for smaller, emerging managers.  Traditionally seeking to chase returns and investing in smaller and nimble managers offering an opportunity for start-ups to emerging managers seeking capital. Regulatory changes are also shaping the investment environment. The US Securities and Exchange Commission recently provided guidance in an effort to expand retail access to private market investments through registered closed-end funds. This development allows family offices to explore new opportunities in private market investments through investment vehicles that have regulatory protections under the federal securities laws. We represent managers that invest in CEFs and attract investors across high net worth, family offices and institutional investors seeking exposure to CEFs managed by experienced and nimble managers. TAKEAWAYS:

• Different approaches to deploying capital: Fund formation, fund investment, direct investment, co-investment
• Family offices continue to be attractive investment partners

The US Securities and Exchange Commission Division of Investment Management Staff recently issued a no-action letter permitting, among, other things, registered investment advisers to use state trust companies to custody crypto assets.  This position is an indication of the increased acceptance of Crypto Assets as an asset class and the increased demand for Crypto Asset investment strategies over the past decade. TAKEAWAYS:

• The Letter defines the term “Crypto Assets” broadly as assets that are “digital representations of value that are recorded on a cryptographically secured distributed ledger.”
• Investment Advisers will still need to comply with certain conditions such as thorough due diligence and disclosures on a potential custodian.

March 17, 2026 -  U.S. SEC, “Application of the Federal Securities Laws to Certain Types of Crypto Assets and Certain Transactions Involving Crypto Assets”.  The interpretation is an effort to establish a clear federal regulatory framework for crypto assets This seminal interpretation is the first step implementing the SEC’s rulemaking agenda related to crypto assets and the definition of a security subject to the SEC regulatory web and to assess how these developments affect their businesses, including which questions have been resolved, which uncertainties remain.  Our managing partner in 1999 was the first attorney to file an IPO approved by the SEC to offer free shares on the Internet covering many of the same issues facing Crypto assets.

U.S. SEC Division of Examinations Announces 2026 Exam Priorities On November 17, 2025, the U.S. Securities and Exchange Commission (SEC or Commission) Division of Examinations (Division) published its annual examination priorities (Priorities) outlining areas of perceived risk and topics that the Division plans to focus on in the new fiscal year. Investment Advisers Adherence to Fiduciary Standards of Conduct The Priorities highlight continued scrutiny of alternative investments (e.g., private credit and private funds with extended lockups), complex investments (including certain ETFs), and higher‑cost products. Expect heightened attention to recommendations to older investors and those saving for retirement. The Division will also focus on advisers that advise both private funds and separately managed accounts or newly registered funds (including conflicts associated with allocations), advisers to newly launched private funds, recommendations of products sensitive to market volatility, and advisers new to advising private funds. Effectiveness of Advisers’ Compliance Programs The Division remains focused on advisers’ compliance programs, including policies related to marketing, valuation, trading, portfolio management, disclosure and filings, custody, and whether their policies and procedures appropriately address and monitor conflicts of interest. Never-Examined Advisers, Recently Registered Advisers, and Advisers Not Recently Examined Advisers that have never been examined will continue to be a priority for the Division, with a focus on newly registered advisers and advisers that have undergone significant business change. Risks Areas Affecting All Market Participants Information Security and Operational Resiliency  Cybersecurity Regulation S-ID and Regulation S-P Emerging Financial Technologies Cryptoassets Anti-Money-Laundering (AML)