Published on Sep 19th, 2023 |

Private Equity Firms Should Consider Outsourced Compliance

Vigilant Insights

Brief Introduction

Vigilant frequently emphasizes the importance of a proactive compliance culture.

Firms that take compliance seriously can help decrease their risk of expensive regulatory fines and punishments.

In an aggressive regulatory environment reaching to every aspect of the market, Private Funds are expected to suffer if they are not maintaining an effective Compliance Program.

Considering the new Private Fund Rule, we discuss three reasons why Private Equity Advisers and Funds should consider outsourced compliance and the importance of it.

The Importance of Compliance

The Importance of Compliance

  1. Successful Compliance Helps Minimize Regulatory Risks
    • Compliance failures cost Firms billions of dollars in 2022.
    • Private Equity Advisers and Funds sometimes take on the compliance burdens of their investments, and a strong compliance program can help decrease that risk.
  2. Successful Compliance Builds Trust in the Firm
    • As investors and regulators have come to expect greater transparency, Firms with successful compliance may gain an edge in the market.
    • Minimized risk for compliance failures should limit the amount of capital being diverted from business goals to mitigating compliance crises.
  3. Successful Compliance Helps Protect your Firm
    • Liabilities in compliance can fall back on senior leadership and their employees.
    • Associated individuals can cause great harm to Firms that do not have proper supervision; first for the infraction, and then an additional charge from failing to supervise.
    • Firms are now being held accountable for the actions of third-parties under due-diligence regulations.

Vigilant's Conclusion

Vigilant’s Conclusion

Vigilant offers a suite of CCO Services tailored to the needs of your Firm.

At a time when Firms struggle to commit the proper resources to maintaining compliance, we offer best in class, cost-effective outsourced compliance that allows you to focus on your business goals.

Partnering with experienced compliance professionals can help your team develop a strong compliance culture that is prepared to handle the constant changes occurring in the industry.

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