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Hedge Funds Face Heightened Scrutiny on SEC Exams in 2021

December 23, 2020

Hedge funds should be prepared to face greater compliance scrutiny with thorough exams in 2021 as a new presidential administration takes power and personnel changes sweep the Securities and Exchange Commission (SEC). Compliance officers have their work cut out for them, with staff supervision, cybersecurity, and environmental, social, and governance (ESG) investing all expected to receive more attention in the new year, industry watchers say.

Craig Moreshead, Managing Director at Foreside, spoke with FundFire reporter Mariah Summers and reiterated that cybersecurity is the most significant concern that hedge fund compliance officers should have in the remote work environment heading into 2021.

Compliance officers need to be actively involved in their company’s cybersecurity program, ensuring that written policies are in place to address the firm’s cybersecurity risks, that the firm has an effective testing and training program, and that the firm is partnered with a cyber expert to help provide ongoing oversight of the firm’s cyber program.

Click here to read the full story in FundFire to see why greater scrutiny placed on ESG could create more opportunities for managers to invest in the space.