Last week a Financial Times' FundFire article by Laura Suter covered the recent trend of alternatives firms hiring former employees of the SEC and the US Attorney's Office. In the article, JW Michaels managing partner Jason Wachtel explained these firms' reasoning:
"By hiring someone who was a prosecutor and worked on significant cases, it sends a clear message to the investor base that [the manager is] really serious about compliance and transparency, and that investors don’t need to worry they are not going to be the next firm on the cover of a magazine saying ’we’re a Ponzi scheme.’ Investors really like that, in fact it’s like a tool to get more dollars, when managers are doing the roadshow they are not just talking about performance, but that they hired someone from the U.S. attorney’s office."
Wachtel went on to warn, however, that when hiring individualt coming out of the SEC or as prosecutors, there can sometimes be a mismatch in salary expectations. At alt firms they could earn between $500,000 and $750,000 per year, but could go to a law firm and make over $1 million. Alt firms must take into consideration the candidate's earning power elsewhere.
Visit FundFire to read the original article [paid subscription]: Alts Shops Raid SEC, Attorney's Office for Compliance Hires by Laura Suter
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