SEC Division of Investment Management Provides Guidance Regarding the Custody Rule and Privately Offered Securities

August 27, 2013

The Division of Investment Management (Division) of the U.S. Securities and Exchange Commission (SEC) recently posted an IM Guidance Update that expands the applicability of an exception from the Custody Rule (as defined below) for certain privately offered securities held by certain private funds (Guidance).1 In 2013, the Division began posting IM Guidance Updates that summarize the SEC staff’s views regarding various requirements of the Investment Company Act of 1940 or the Investment Advisers Act of 1940 (Advisers Act). These Guidance Updates are not subject to SEC approval and do not have the force of a rule or regulation.

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