# kaal:claim:2337268-015

**Claim.** The pre Dodd-Frank exemption for advisers with fewer than fifteen clients failed as a regulatory boundary because most hedge fund advisers deliberately designed their operations and legal structures to fit within it and thereby escape SEC registration and supervision.

**Type.** failure  **Support.** argued

**Holds when.**

- hedge fund advisers before the enactment of Title IV in 2010

**Source quote.**

> Most hedge fund advisers set up their operations and legal structure to comply with the former exemption so as to avoid registration and supervision by the SEC.28

**From.** Wulf A. Kaal, *Investment Adviser Regulation* (2013), 3. Registration, page 9

**Cite as.** Wulf A. Kaal, Investment Adviser Regulation (2013). SSRN: https://ssrn.com/abstract=2337268

**Verify.** sha256 of source PDF `7075ce35282a8ee75b81ae3dec0e19f68631beae7f3c3a00ab2827538dc9e302` at https://raw.githubusercontent.com/wulfkaal/Academic-Papers/main/papers/pdf/Kaal%20-%202013%20-%20Investment%20Adviser%20Regulation.pdf

**Failure mode.** exemption structuring around client count thresholds  (family: regulatory-arbitrage)

**Topics.** securities-law, regulatory-failure, private-funds

**Keywords.** registration-exemption, regulatory-arbitrage, hedge-fund-advisers, structuring

**Related claims.**

- supports: https://wulfkaal.github.io/claims/2150377-008

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