Rivulet Media Inc (fka RIVU)

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Hey! Don't shoot the messenger! It's all relative!!!

Specialized Enforcement Units
At the beginning of 2010, the SEC’s Division of Enforcement announced the creation of
five specialized units designed to focus on complex subject areas of particular interest to
the SEC. One of those specialized units, Asset Management, is dedicated to
enforcement matters relating to registered and unregistered investment advisers,
including advisers to private funds.2
The division also created a new Office of Market
Intelligence, led by Thomas A. Sporkin, that is responsible for “the collection, analysis,
risk-weighing, triage, referral, and monitoring of the extraordinary number of tips,
complaints, and referrals the SEC receives each year.”3
The Asset Management Unit is led by Co-Chiefs Bruce Karpati and Robert B. Kaplan,
two associate directors within the Division of Enforcement, and has been fully staffed
since the spring of 2010. It consists of approximately a dozen assistant directors in the
SEC’s home office in Washington, D.C. and nine other regional offices, and individual
staff attorneys in each of those locations. The members of the unit reportedly hold regular
meetings to share market intelligence, develop investigative leads, and discuss particular
theories of liability.
Although the jury is still out on the effectiveness of this new structure, the theory behind
the new units—that Division of Enforcement attorneys dedicated to particular areas will
be more effective in combating violations of the federal securities laws—is a sound one.
As the attorneys in these units become more familiar with the private fund industry,
advisers who find themselves subject to SEC scrutiny should expect investigations to
proceed more expediently and with greater focus.

---MORGAN LEWIS 2010 HEDGE FUND ENFORCEMENT REVIEW

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