SEC Proposes Amendments to Expand Responsible Retailization of Private Markets
The Securities and Exchange Commission voted to propose rule amendments aimed at broadening retail access to private-market strategies and easing capital formation in public and private markets. The package would allow registered investment advisers to receive performance-based fees from certain regulated clients, modernize interval fund rules, create a rules-based framework for multiple share classes in closed-end funds, and seek public comment on new paths to qualify as an accredited investor.
Why It Matters
If adopted, the changes could increase retail exposure to strategies historically limited to private funds by aligning compensation and fund structures for regulated vehicles and by expanding non-wealth-based ways for individuals to qualify as accredited investors. The proposals also tie into broader executive-level efforts to open retirement accounts to alternative assets, according to the SEC statement.
Key Facts
- Agency: U.S. Securities and Exchange Commission (SEC)
- Date of announcement: Sept. 30, 2026
- Proposal components: Allow performance-based compensation for advisers to certain regulated funds; amend fund registration and reporting to disclose such compensation; modernize interval fund rules; replace exemptive orders with rules for multiple share classes in regulated closed-end funds
- Accredited investor comment: SEC seeks public comment on adding an exam developed by FINRA and certain professional credentials as additional paths to accredited investor status
- Credentials under consideration: U.S. CPA, CFA charter, CFP certification (U.S.), FINRA Series 79, FINRA Series 86/87
The Securities and Exchange Commission voted on Sept. 30, 2026 to propose a set of rule changes intended to expand retail investor choice and promote innovation in regulated fund structures while maintaining investor protections. The package would permit registered investment advisers to receive performance-based compensation from certain categories of clients, including regulated funds, when fees are tied to capital gains or capital appreciation — a payment model common in private fund strategies. The proposal would also require amendments to certain fund registration and reporting forms so that performance-based compensation is disclosed to investors. In addition, the SEC would modernize the interval fund framework, enabling repurchase schedules that better align with a portfolio’s liquidity profile. For regulated closed-end funds, the Commission would replace current exemptive orders with a rules-based framework to allow issuance of multiple share classes. Separately, the SEC is requesting public comment on additional ways for individual investors to qualify as accredited investors. One option under consideration is recognizing passage of an accredited investor exam to be developed by FINRA as a non-financial pathway to accreditation. The Commission is also seeking input on whether holding certain professional licenses, certifications, or credentials in good standing could serve as alternate routes to accredited status. The list of specific credentials the agency cited for potential recognition includes a U.S. certified public accountant (CPA) license, the Chartered Financial Analyst (CFA) charter, the Certified Financial Planner (CFP) certification in the United States, the FINRA Investment Banking Representative license (Series 79), and the FINRA Research Analyst licenses (Series 86 and 87). Public comment periods for the proposing releases and notices will remain open for 60 days following publication in the Federal Register.
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