Panel Pushes to Give Ordinary Investors Access to Private Equity

(Bloomberg) -- Individual investors should have access to private equity, according to a report from the Committee on Capital Markets Regulation.

The group, which includes representatives from asset managers and banks, called on U.S. regulators to make it much easier for 401(k) plans to invest in private equity funds. The Department of Labor should issue guidance protecting plan sponsors from legal claims such as those related to costs or liquidity, said the report released Tuesday.

The report also urges Congress to act so that a wide range of investors, not just the wealthy, can put their money directly toward buyout funds. It recommends the Securities and Exchange Commission grant average investors the ability to participate in public closed-end funds that put more than 15 percent of their assets in private equity.

Money managers have been eyeing retirement nest eggs as a potential boon. Blackstone Group LP Chief Executive Officer Steve Schwarzman said last year it’s his dream to open alternative-investment funds to regular savers. The firm’s senior managing director and legal chief, John Finley, is on the committee, along with others including BlackRock Inc. Vice Chairman Barbara Novick, Citadel founder Ken Griffin and Vanguard Group Chief Executive Officer Tim Buckley.

A representative from Bloomberg LP is also a member.

To contact the reporter on this story: Krista Gmelich in New York at kgmelich1@bloomberg.net

To contact the editors responsible for this story: Margaret Collins at mcollins45@bloomberg.net, Josh Friedman, Alan Mirabella

©2018 Bloomberg L.P.