SEC Charges Private Equity Fund Adviser with Fee and Expense Disclosure Failures

The Securities and Exchange Commission today charged registered investment adviser Global Infrastructure Management, LLC for failing to properly offset management fees and for making misleading statements about the fees and expenses it charged. Global agreed to pay a $4.5 million penalty to settle the SEC charges and voluntarily has repaid $5.4 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.