Publications
The Long View: Why Working Through Every Item on an Extensive Checklist May Obscure the Bigger Risks – Particularly Conflicts of Interest
November 22, 2012
Checklists are popular as the year end approaches. For hedge fund managers, Dodd-Frank and the Alternative Investment Fund Managers Directive make these checklists even more challenging. Most managers have devoted more resources than ever before to understanding and complying with all of the applicable requirements. But when it comes to regulatory compliance, well-intentioned managers may miss the forest for the trees. Working through every item on an extensive checklist may obscure bigger risks. In this column, Marc E. Elovitz and former Schulte lawyer Brad L. Caswell discuss how to identify and address these bigger risks as a critical part of every manager’s regulatory compliance program.
Related People
Attachments
Related Insights
Alerts
On April 24, 2024, the Internal Revenue Service (“IRS”) released final regulations (TD 9992) (“Final Regulations”) addressing the determination of whether a real estate investment trust (“REIT”) is “domestically controlled.” The Final Regulations finalize proposed regulations (REG-100442-22) (“Proposed Regulations”) under Section 897 of the Internal Revenue Code published on Dec. 29, 2022.[1]
Alerts
On Feb. 16, 2024, the Financial Crimes Enforcement Network (“FinCEN”), a bureau of the United States Department of the Treasury (“Treasury”), issued a notice of proposed rulemaking (“Proposed Rule”)[1] continuing the process of implementing regulations to combat illicit finance risks posed by abuse by some in the real estate market. The Proposed Rule would require certain persons involved in residential real estate closings and settlements to submit reports (“Real Estate Reports”) and keep accurate records of certain non-financed transfers of US residential real property. The reasoning behind the Proposed Rule is explained extensively in FinCEN’s December 2021 Anti-Money Laundering Regulations for Real Estate Transactions Advanced Notice of Proposed Rulemaking, which discusses “the opacity of shell companies or other legal entity structures to mask true beneficial ownership of a property and their involvement in real estate transactions.”[2]
Alerts
The Federal Trade Commission (“FTC”) passed its long-anticipated final Non-Compete Rule broadly prohibiting the use of worker non-competition restrictions. The Non-Compete Rule is scheduled to be published in the Federal Register on May 7, 2024, and become effective 120 days later, on Sept. 4, 2024. To the extent the Non-Compete Rule is more restrictive than a state or local law, the Non-Compete Rule will supersede such other law. However, the validity of the Non-Compete Rule is already being challenged in three separate court cases and its effective date may be delayed.
Alerts
On April 24, 2024, the Internal Revenue Service (“IRS”) released final regulations (TD 9992) (“Final Regulations”) addressing the determination of whether a real estate investment trust (“REIT”) is “domestically controlled.” The Final Regulations finalize proposed regulations (REG-100442-22) (“Proposed Regulations”) under Section 897 of the Internal Revenue Code published on Dec. 29, 2022.[1]
Alerts
On Feb. 16, 2024, the Financial Crimes Enforcement Network (“FinCEN”), a bureau of the United States Department of the Treasury (“Treasury”), issued a notice of proposed rulemaking (“Proposed Rule”)[1] continuing the process of implementing regulations to combat illicit finance risks posed by abuse by some in the real estate market. The Proposed Rule would require certain persons involved in residential real estate closings and settlements to submit reports (“Real Estate Reports”) and keep accurate records of certain non-financed transfers of US residential real property. The reasoning behind the Proposed Rule is explained extensively in FinCEN’s December 2021 Anti-Money Laundering Regulations for Real Estate Transactions Advanced Notice of Proposed Rulemaking, which discusses “the opacity of shell companies or other legal entity structures to mask true beneficial ownership of a property and their involvement in real estate transactions.”[2]
Alerts
The Federal Trade Commission (“FTC”) passed its long-anticipated final Non-Compete Rule broadly prohibiting the use of worker non-competition restrictions. The Non-Compete Rule is scheduled to be published in the Federal Register on May 7, 2024, and become effective 120 days later, on Sept. 4, 2024. To the extent the Non-Compete Rule is more restrictive than a state or local law, the Non-Compete Rule will supersede such other law. However, the validity of the Non-Compete Rule is already being challenged in three separate court cases and its effective date may be delayed.
Alerts
On April 24, 2024, the Internal Revenue Service (“IRS”) released final regulations (TD 9992) (“Final Regulations”) addressing the determination of whether a real estate investment trust (“REIT”) is “domestically controlled.” The Final Regulations finalize proposed regulations (REG-100442-22) (“Proposed Regulations”) under Section 897 of the Internal Revenue Code published on Dec. 29, 2022.[1]