December 27, 2016
Corgentum Announces Release of New Hedge Fund Compliance Book
Corgentum Consulting today announced the release of Managing Partner Jason Scharfman’s new book on the subject of hedge fund compliance.
Hedge Fund Compliance: Risks, Regulation, and Management delivers critically important information on this evolving area of the hedge fund industry. Issues related to the implementation of compliance in hedge funds continue to be at the forefront of the minds of both investors and fund managers alike. As a recent example, all one has to do is read the recent headlines concerning the allegations in cases such as the Platinum Partners situation to understand the critically important role effective compliance oversight can play in the successful management of a hedge fund.
Compliance is one of the fastest growing areas in hedge funds, and this book provides straightforward practical guidance for the development and analysis of a hedge fund’s compliance program. Key topics covered by the book include:
- Examination of the regulatory examination processes and reporting obligations required by key global hedge funds regulators
- Analysis of the core components of a hedge fund compliance program ranging from the role of the Chief Compliance Officer to cybersecurity policies
- An overview of insider trading risk management through compliance policies relating to the use of expert networks, electronic communication archiving and surveillance, and the management of material non-public information (MNPI)
- Investment compliance considerations including trade surveillance, trade allocation policies and soft dollar usage
- Due diligence approaches for investors seeking to evaluate and monitor hedge fund compliance programs
- Examination of examples of core hedge fund compliance documentation including a Compliance Manual and Code of Ethics
- The emerging role of compliance consultants
Exclusive interviews with hedge fund compliance practitioners are also featured. Additionally, the book has a companion website that includes examples of compliance policies and links to laws and regulations referenced in the book.
Hedge Fund Compliance is available for order on Amazon.
November 10, 2016
Corgentum Authors Private Equity ODD Reference for Private Equity International
Private equity limited partners (LPs) are continuing to increase their focus on the operational practices of General Partners (GPs).
LPs have expanded their due diligence efforts beyond reviews of traditional back office operational risks to increasing include reviews of GPs cybersecurity and compliance efforts. This has been coupled with increased scrutiny from regulators, such as the U.S. Securities and Exchange Commission, on private equity practices in areas including valuation, pay-to-play concerns and conflict of interest management.
Commenting on these trends Corgentum Consulting Managing Partner Jason Scharfman has contributed a chapter on private equity operational due diligence practices and investigative due diligence approaches to a new book from Private Equity International.The book, Private Equity Fund Investment Due Diligence , also covers topics including operating value creation, succession, co-investment and ESG and is available on the PEI website.
October 10, 2016
Corgentum Authors Operational Due Diligence Curriculum for CAIA
Corgentum Consulting Managing Partner Jason Scharfman recently contributed two chapters on operational due diligence to the revised Level II CAIA curriculum.
Sponsored by the Chartered Alternative Investment Analyst (CAIA) Association, the CAIA Charter is the leading educational standard uniquely designed for individuals specializing in institutional-quality alternative investments. Covering hedge funds, managed futures, real assets, private equity, commodities, structured products, risk management and portfolio management, and professional standards and ethics, the CAIA Charter demonstrates one's commitment to professionalism and command of AI's unique fundamentals.
The CAIA program is comprised of a two-tier exam process (Level I and Level II) . The Level I exam assesses candidates understanding of various alternative classes and knowledge of the tools and techniques used to evaluate the risk-return attributes of each one. The Level II exam assesses application of the knowledge and analytics learned in Level I within a portfolio management context.The first chapter in the Level II curriculum text (CAIA Level II: Advanced Core Topics in Alternative Investments) authored by Mr. Scharfman is Chapter 10 and it focuses on core topics in private equity operational due diligence. The second chapter he authored, Chapter 33, outlines the fundamentals of hedge fund operational due diligence as well as investigative due diligence considerations.
July 5, 2016
Corgentum Analyzes the Panama Papers Case with McClatchy DC
The Panama Papers case represented one of the biggest leaks of financial data in recent history. The leaked documents from Panamanian law firm Mossack Fonesca provided a wealth of information about the use of offshore tax structures, also called tax havens.
In their normal course of business, fund managers including hedge funds and private equity funds, make extensive use of these offshore structures in countries such as the Cayman Islands. Data leaks such as the Panama Papers highlight a number of operational concerns for fund managers ranging from cybersecurity and compliance to governance and service provider oversight.
This case also brings into question larger policy issues relating to broader governance and compliance questions. To comments on the role played by the oversight of offshore fund directors and fund reporting transparency concerns Corgentum Consulting Managing Partner Jason Scharfman discussed the case with McClatchy DC.
The article, Panama Papers reveal yet another secretive aspect of hedge funds can be found McClathcy DC website.
May 5, 2016
Corgentum Discusses Governance and Conflicts of Interest with the International Business Times
Issues relating to governance and conflicts of interest continue to be at the forefront of the investment landscape. These matters are particularly of note for the management of public pension systems.
One recent case relates to the recent appointment of North Carolina Treasurer Janet Cowell to the boards of insurance conglomerate James River Group Holdings and e-commerce firm ChannelAdvisor. When potential conflicts of interest such as this arise, it is often advisable for pension funds to apply the same rigorous governance and conflict of interest standards that they should apply to their fund managers.
The James River Group Holdings and e-commerce firm ChannelAdvisor. had called for Ms. Cowell to either resign from the boards or step down as treasurer. Corgentum Consulting Managing Partner Jason Scharfman discussed the issue with the International Business Times.
Addressing the potential governance issues of having a public employee serving on the board of a private company while still in office Mr. Scharfman states, “ Usually the more common practice is you leave public service and leverage that service for a job — but taking jobs while you are still in a government role is unusual...even if there is not a conflict, it could appear to be a conflict, which is enough to make a lot of people uncomfortable — and there seems to be a lot of potential for real conflicts. ” The full article, North Carolina Treasurer Will Run State Pension While Serving On Corporate Boards can be read on the IBT website.
February 9, 2016
Corgentum's Scharfman Named to CAIA Due Diligence, Risk Management and Regulation Committee
Corgentum is proud to announce that Jason Scharfman (Managing Partner, Corgentum Consulting) has been named a member of the Chartered Alternative Investment Association (CAIA) Due Diligence, Risk Management and Regulation Committee.
"CAIA is a wonderful organization and I look forward to continuing to work with them to improve operational due diligence education throughout the industry," said Mr. Scharfman. Mr. Scharfman was also profiled last year in CAIA's Quarterly Publication Alternative Investment Analyst Review.