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November 18, 2019

Over the past year, investment activities at endowments have faced increasing public scrutiny in what can only be described as a highly politicized environment. At the same time, federal enforcement personnel have repeatedly warned that criminal charges will be harsher, and more likely to be brought, in cases where an organization lacks a comprehensive, continuously improving compliance program that is audited to assure its effectiveness. In the face of these requirements, The Regulatory Fundamentals Group LLC (RFG) surveyed internal audit teams at charitable organizations with endowments larger than $1 billion to understand how they tackled endowment audits. The white paper is available on our website here. For information about RFG's services for nonprofit investment offices, email Information@Re...

June 25, 2019

Pundits are pointing to near-term challenges to the global economy’s productive run since the 2008- 2009 financial crisis. RFG recently asked experts for their suggestions about what endowments and foundations should consider before the next downturn. An abstract of the suggestions, previously provided to RFG endowment and foundation consortium clients in RFG’s weekly newsletter, follows.

Consider the holistic needs of your organization – This includes access to other sources of revenue beyond the investment fund you manage and uncertainties concerning the organization’s costs and expenses.

Consider investment risks that did not exist in 2008 – Investment portfolios have changed over the past 10 years and those changes might impact performance and liquidity expectations. Significant changes might include:


May 16, 2019

The need for every organization to understand the legal environment in which it operates (through a comprehensive, continuously improving compliance program) was underscored by significant announcements issued by federal enforcement agencies over the past few weeks. These announcements apply to all U.S. persons, even investors which are not required to register with a financial regulatory authority (such as the SEC).  

Moreover, even SEC registrants that fully comply with SEC compliance requirements may  still fall short of the new guidelines. The reason is simple: the new guidelines apply to activities that go beyond the requirements set out in the federal securities laws.

In the eyes of the U.S. federal regulators, you have been put on notice. Expect other domestic and international regulatory authoriti...

March 8, 2019

Pre-Conference Program:

Garnering Efficiencies for the Investment Office

Wednesday, May 15, 2019  |  1:00 PM - 4:30 PM

Citco Fund Services: 350 Park Ave, 13th Floor, New York, NY 10022

1:00 PM           AI and the Investment Office Workload

A look at the AI tools that exist today, what might exist in the future and how decisions to insource or outsource technology should be made, with a focus on document management.

Moderator: Christopher J. Adams, Chief Strategic Counsel, McDermott Discovery


Aaron Crews, Chief Data Analytics Officer, Littler Mendelson P.C.

Brian Kuhn, Partner, Co-Founder and Global Leader of the Watson Legal Practice, IBM

2:30 PM           Coffee Break

2:45 PM           Technology’s Increasin...

October 5, 2018

RFG has prepared, for its consortium members only, a white paper that discusses the issues encountered when an allocation is made to an investment manager that holds crypto assets.

The white paper notes that crypto assets are not themselves an asset class, but rather a term used to address a wide variety of fundamentally different investments. As crypto assets are new, and untested, each asset needs to be considered on its own to determine whether it is “fit” for its stated purpose. Considerations should include both a coding perspective and the perspective of whether the crypto asset appropriately addresses existing legal frameworks that apply to transactions and transfers. The white paper suggests eight specific areas that might be considered as part of this analysis.


August 8, 2018

In partnership with DMS Governance, RFG has produced an illustrative chart of service providers seeking to assist charitable organizations in the receipt of cryptocurrency donations. The chart includes a detailed list of crypto asset service providers and liquidity providers who have indicated an interest in helping charitable organizations to accept, as well as to monetize, donations of cryptocurrencies. The document will continue to be updated on a periodic basis.

Concurrently with the release of the service provider guide, RFG has released to its consortium members a white paper that discusses selected accounting, tax, regulatory, contractual and policy considerations that arise for a charity and donor when contemplating a gift of Bitcoin, Ethereum Ripple, Bitcoin cash, and Litecoin (the top fi...

March 13, 2018

We are scrutinizing a new topic: the EU’s General Data Protection Regulation, which becomes effective May 25th. It seems possible that some charitable organizations — and their endowment investment offices — might technically fall within the GDPR’s scope. Although the drive behind the GDPR was to strengthen data protections provided to EU consumers who interact with internet companies that gather and retain information, the precise balance to its reach is yet to be determined. As so often happens with a new regulatory requirement, broad language was used, little guidance exists on the application to investors, and future regulatory clarifications could easily eliminate burdensome and onerous requirements (or, of more concern, expand them).  As if this were not enough,  there exists a great deal of uncer...

May 5, 2017

In a recent piece for RFG, Finbarr O’Connor of the Berkeley Research Group comments on the process for winding down a hedge fund. He notes that hedge funds most frequently close due to underperformance but events such as litigation, regulatory issues, key-man events and loss of members of the investment team may also trigger closure. Read more here.

March 24, 2017

As we face the prospect of substantial policy changes emanating from Washington, DC, RFG asked industry pros for their insights on the greatest challenges facing fund managers. They identified several key issues, including the threat of the index fund revolution and the perils of succession; challenges to fundraising; the impact of tax reform on transactions; whether hedge funds should plan for a Trump recession; new AML regulations; and the fiduciary rule.

Read what they had to say here.

March 21, 2017

Recently, U.S. District Judge Jed S. Rakoff urged passage of a statute prohibiting insider trading. Currently judicial decisions define the boundaries of the law which is based on anti-fraud provisions of the Securities Exchange Act. This, the judge believes, creates “unnecessary uncertainty” as prosecutors try to “shoehorn” what should be a “cheating” concept into a “fraud” framework. In contrast, in the EU, trading on non-public information is prohibited (in order to provide for equal market access) without requiring that the source of the information “breach” a fiduciary duty.

What do litigators think of this suggestion? RFG asked several industry experts. We thought you might be interested in their responses, which can be found in our article addressing the issue here. This and other topics of intere...

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