SEC’s Top Cop Concerned About Private Credit Valuations, Opacity – Bloomberg

During a wide-ranging interview this week, Gurbir Grewal said he sees a range of potential risks in the $1.7 trillion private-lending industry. The enforcement chief signaled everything from market concentration to the way assets are valued will face more scrutiny.

“I’m concerned about valuation issues: how they’re marking these investments because they are illiquid,” Grewal said. “I’m concerned about — as we would be with other private funds — fee and expense issues, and with conflict-of-interest issues.”

The SEC is taking a closer look at private credit.The SEC hasn’t brought many enforcement actions over private lending, and Grewal didn’t mention any specific firms or deals drawing regulatory attention. Still, his comments serve as a warning as some of the biggest names in finance increase their involvement.

Source: SEC’s Top Cop Concerned About Private Credit Valuations, Opacity – Bloomberg