# kaal:claim:2714974-015

**Claim.** Co-investment arrangements become problematic when a fund grants a co-investment opportunity in exchange for a future or increased fund commitment and the practice is not adequately disclosed, especially where the fund's governing documents would prohibit the allocation.

**Type.** condition  **Support.** argued

**Holds when.**

- applies where limited partners are also co-investors
- turns on adequacy of disclosure and the fund's governing documents

**Source quote.**

> If such private fund advisers' practices are not adequately disclosed, co-investments can often be problematic.

**From.** Kaal and Oesterle, *The History of Hedge Fund Regulation in the United States* (2016), Hedge Fund Mandatory Disclosure, page 14

**Cite as.** Kaal and Oesterle, The History of Hedge Fund Regulation in the United States (2016). SSRN: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2714974

**Verify.** sha256 of source PDF `7764601d3ed5bb056b58949e8411eff9dfb9855f143719062030c980c5fa801b` at https://raw.githubusercontent.com/wulfkaal/Academic-Papers/main/papers/pdf/Kaal%20and%20Oesterle%20-%202016%20-%20The%20History%20of%20Hedge%20Fund%20Regulation%20in%20the%20United%20States.pdf

**Failure mode.** Undisclosed co-investment allocation  (family: disclosure-ineffectiveness)

**Topics.** disclosure

**Keywords.** co-investment, disclosure, conflicts-of-interest, limited-partners

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