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SEC charges private equity fund adviser with fee and expense disclosure failures

The Securities and Exchange Commission has charged registered investment adviser Global Infrastructure Management, for failing to properly offset management fees and for making misleading statements about the fees and expenses it charged. Global agreed to pay a USD4.5 million penalty to settle the SEC charges and voluntarily has repaid USD5.4 million to its affected private fund clients. 

According to the SEC’s order, Global failed to offset certain portfolio company fees against management fees charged to clients, as it was required to do under the offering and governing documents. As a result, clients overpaid millions in additional management fees. The SEC’s order also found that Global provided investors with inconsistent statements about how Global would calculate management fees. In addition, the SEC’s order found that these violations were caused by deficiencies in Global’s compliance program.

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