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Litigation Defense & Compliance Attorneys for Hedge Funds

Our Lawyers Represent Hedge Funds and Their Owners in All Federal Litigation, Compliance and Enforcement Matters

Hedge funds operate in a heavily regulated environment. They are subject to scrutiny from multiple federal authorities, and they face a high risk of litigation when their chosen investment strategies lead to investor losses. As a result, hedge funds and their owners need to prioritize compliance, and they need to be prepared to defend themselves on multiple fronts.

Hedge Fund Lawyers with Relevant Experience

John W. Sellers
Attorney John W. Sellers
Hedge Funds Litigation &
Compliance Team Lead
Former DOJ Trial Attorney
envelope iconContact John

At Oberheiden P.C., our hedge fund lawyers bring notable, relevant experience to the table. In addition to their experience in private practice, many of our lawyers have prior experience handling securities investigations and enforcement matters for the federal government. We represent hedge funds headquartered domestically and abroad, and we have the capabilities required to provide effective, full-service representation.

Whether you are establishing a new hedge fund, your hedge fund’s compliance program needs an audit (and potential overhaul), or your hedge fund is facing litigation, our lawyers can help. Contact us to discuss your fund’s needs with a hedge fund lawyer at Oberheiden P.C. today.

Full-Service Legal Representation for Hedge Funds in the U.S. and Abroad

Our lawyers advise hedge funds on all aspects of federal compliance and handle matters ranging from internal audits and civil litigation and federal investigations and law enforcement proceedings. Whether you are looking to engage outside general counsel or need a hedge fund lawyer to resolve a particular issue, we can offer a solution that is custom tailored to your fund’s needs. Our services include:

Hedge Fund Compliance

Hedge funds face a bevy of compliance obligations under U.S. federal law. From securities law compliance to anti-money laundering (AML) compliance, it is imperative that hedge funds ensure their internal compliance programs duly address all pertinent legal and regulatory requirements.

We work with our hedge fund clients to help them develop and implement effective compliance programs. When it comes to fending off federal allegations, being able to demonstrate good-faith adherence to a comprehensive and custom-tailored program can be critical. The U.S. Securities and Exchange Commission (SEC), Commodity Futures Trading Commission (CFTC), and other federal agencies all expect hedge funds to be able to affirmatively demonstrate compliance—and those that cannot will have a difficult time avoiding expensive penalties in the event of a federal audit or investigation.

Some examples of the areas in which we help hedge funds establish and maintain compliance include:

  • AML compliance
  • Financial Industry Regulatory Authority (FINRA) compliance
  • Fund formation, capitalization and governance
  • Investment Company Act of 1940 and Dodd-Frank Act compliance
  • National Futures Association (NFA) registration and compliance
  • SEC and CFTC compliance
  • Tax planning and compliance

In addition to assisting with compliance in these (and other) broad areas, we also serve as compliance counsel for discrete events and transactions. This includes matters such as redemptions, distressed investing, synthetic leverage transactions, and pursuing exit strategies. We assist with corporate, cybersecurity, and other general compliance matters as well.

Internal Audits for Hedge Funds

When it comes to satisfying federal authorities that hedge funds are meeting their statutory and regulatory obligations, implementing effective compliance programs only gets hedge funds half way. Hedge funds also need to be able to demonstrate that they are assessing their compliance efforts and enforcing compliance internally on an ongoing basis.

To do this, hedge funds must conduct periodic internal audits. They must also conduct internal audits in response to potential and identified compliance failures. When conducting internal audits, it is imperative to operate under the oversight of outside counsel, and hedge funds must carefully document the audit process so that they have the requisite documentation on hand.

Hedge Fund Transactions

Our hedge fund lawyers also work closely with our clients on all types of transactional matters. This includes internal corporate and employment transactions as well as transactions with external third parties. With an in-depth understanding of how hedge funds’ compliance obligations impact their contractual needs and contract-related litigation risks, we take an efficient yet all-encompassing approach to ensuring that our clients’ contracts have the terms and conditions needed to protect our clients’ interests. Representative transactional matters our lawyers handle for hedge funds include:

  • Contracts with executives, directors, and personnel
  • Contracts with third-party research agencies
  • Investor agreements
  • Mergers and acquisitions
  • Private equity transactions
  • Restructuring transactions
  • Severance contract negotiations

When negotiating contracts, it is often necessary to examine risks outside of the terms of the deal. This is especially true in heavily regulated industries such as securities, futures, and commodities. With our lawyers’ experience in private practice and in federal enforcement, we have a comprehensive understanding of the risks our clients face, and we rely on this understanding to help our clients make informed and strategic decisions during the dealmaking process.

Federal Hedge Fund Investigations

For hedge funds, facing scrutiny from the SEC, CFTC, U.S. Department of Justice (DOJ), or any other federal agency can present substantial risks. Not only do regulatory agencies such as the SEC and CFTC have substantial administrative and civil enforcement authority, but they can also refer cases to the DOJ for criminal prosecution when warranted. Several relevant federal laws include provisions for both civil and criminal enforcement; and, when facing a federal hedge fund investigation, a critical first step is to identify the specific allegations that are on the table.

Our lawyers have substantial experience representing hedge funds and a broad range of other clients in federal law enforcement investigations. While these investigations can be risky, hedge funds will often have a variety of possible defenses available. When facing a federal investigation, the key is to formulate a defense strategy that takes into account the realities at hand (both favorable and unfavorable), and then to execute this strategy while being prepared to adapt to new developments as necessary.

Federal Enforcement Actions Targeting Hedge Funds

When federal investigations lead to charges, hedge funds and their owners must be prepared to fight their charges by all means available. At Oberheiden P.C., we have had significant success helping our clients avoid penalties in both civil and criminal cases. We also have experience negotiating favorable resolutions with federal authorities when warranted; and, here too, we help our clients make sound decisions with their long-term business and financial interests in mind.

Private Hedge Fund Litigation Defense

Along with representing clients in federal enforcement litigation, our hedge fund lawyers also represent clients in civil litigation involving private-right-of-action claims, allegations of investment fraud, and other alleged federal statutory and regulatory violations. These lawsuits often present the risk for substantial exposure, and establishing unfavorable precedent can open the floodgates to additional claims. Our lawyers are highly experienced in providing effective representation during discovery, pre-trial practice, and trial—and they rely on this experience to develop the leverage needed to secure efficient and favorable results for our clients.

Put our highly experienced team on your side

Dr. Nick Oberheiden
Dr. Nick Oberheiden

Founder

Attorney-at-Law

Lynette S. Byrd
Lynette S. Byrd

Former DOJ Trial Attorney

Partner

Brian J. Kuester
Brian J. Kuester

Former U.S. Attorney

Amanda Marshall
Amanda Marshall

Former U.S. Attorney

Local Counsel

Joe Brown
Joe Brown

Former U.S. Attorney

Local Counsel

John W. Sellers
John W. Sellers

Former Senior DOJ Trial Attorney

Linda Julin McNamara
Linda Julin McNamara

Federal Appeals Attorney

Aaron L. Wiley
Aaron L. Wiley

Former DOJ attorney

Local Counsel

Roger Bach
Roger Bach

Former Special Agent (DOJ)

Chris Quick
Chris J. Quick

Former Special Agent (FBI & IRS-CI)

Michael S. Koslow
Michael S. Koslow

Former Supervisory Special Agent (DOD-OIG)

Ray Yuen
Ray Yuen

Former Supervisory Special Agent (FBI)

FAQs: Hedge Fund Compliance, Litigation, and Federal Enforcement Defense

How Important Is It for Hedge Funds to Implement Compliance Programs?

 

For hedge funds, implementing an effective compliance program is extremely important, as it serves several critical risk management functions. Not only does maintaining adherence to a documented compliance program help hedge funds meet their legal obligations and avoid statutory and regulatory violations, but it also puts hedge funds in a position to defend themselves successfully during federal investigations and enforcement proceedings.

Does the SEC Regulate Hedge Funds?

 

Yes, the SEC regulates hedge funds. While hedge funds are not subject to registration (nor are they subject to the same level of regulation as mutual funds and investment firms), they are still subject to SEC oversight. As a result, when developing their compliance programs, hedge funds must do so with their specific SEC compliance obligations in mind.

Does the CFTC Regulate Hedge Funds?

 

Yes, hedge funds are also subject to regulation by the CFTC. While the CFTC recognizes a “hedge exemption,” not all hedge funds qualify, and even those that do must still address other pertinent regulatory requirements.

Do Hedge Funds Have Reporting Requirements?

 

Whether a hedge fund is subject to federal reporting requirements depends on various factors. Broadly speaking, hedge funds remain subject to relatively limited oversight at the federal level. However, the SEC, CFTC, and other federal agencies have been devoting additional resources to hedge fund compliance enforcement in recent years; and, for those that have reporting requirements, failure to file all necessary reports is likely to trigger federal scrutiny.

What Should I Do if My Hedge Fund is Under Investigation?

 

If your hedge fund is under investigation by the SEC, CFTC, DOJ, or any other federal agency, you need to engage defense counsel promptly. You will want to achieve a favorable resolution during the investigative process if at all possible. At Oberheiden P.C., our hedge fund lawyers have had significant success representing clients in federal investigations, and we execute targeted litigation defense strategies when necessary.


Speak with a Hedge Fund Lawyer at Oberheiden P.C.

If you would like more information about our firm’s hedge fund practice, we invite you to get in touch. To speak with a hedge fund lawyer at Oberheiden P.C. in confidence, please call 888-680-1745 or request a complimentary consultation online today.

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