The absence of due diligence standards traces to private funds' unique market position: unlike mutual funds, private funds evolved as unregistered entities free from most regulatory oversight, so their investor due diligence also evolved without oversight.
Source quote, verbatim
Lack of standards for private fund investor due diligence could partially be attributed to private funds' unique position in markets—unlike mutual funds, private funds evolved as unregistered entities, free from most regulatory oversight. Accordingly, private fund investor due diligence evolved
From
Wulf A. Kaal, Private Investment Fund Regulation - Theory and Empirical Evidence from 1998 to 2016 (2017), IV.3 Private Fund Investor Due Diligence, p. 40 https://ssrn.com/abstract=2998097 · source PDF
Cite as
Wulf A. Kaal, Private Investment Fund Regulation - Theory and Empirical Evidence from 1998 to 2016 (2017). SSRN: https://ssrn.com/abstract=2998097
Holds when
private funds compared with mutual funds
United States
Classification
mechanismsupport: arguedprivate-funds
Related claims
restateskaal:claim:2811718-037 Lacking standards for private fund investor due diligence can partly be attributed to private funds' unique ma...
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