are private equity firms regulated 
while private equity funds are exempt from regulation by the securities and exchange commission sec under the investment company act of 1940 or the securities act of 1933 their managers remain subject to the investment advisers act of 1940 as well as the anti fraud provisions of federal securities laws 33 in february 2022 the sec proposed extensive new reporting and client disclosure requirements for private fund advisers including private equity fund managers 3435 the new rules would require private fund advisers registered with the sec to provide clients with quarterly statements detailing fund performance fees and expenses and to obtain annual fund audits all fund advisors would be barred from providing preferential terms for one client in an investment vehicle without disclosing this to the other investors in the same fund 36the bottom linefor a large enough company no form of ownership is free of the conflicts of interests arising from the agency problem like managers of public companies private equity firms can at times pursue self interest at odds with those of other stakeholders including limited partners still most private equity deals create value for the funds investors and many of them improve the acquired company in a market economy the owners of the company are entitled to choose the capital structure that works best for them subject to sensible regulation 