By Katanga Johnson

WASHINGTON, (Reuters) – The U.S. Securities and Exchange Commission will present new rules Wednesday in an effort to improve hedge fund and private-equity fund disclosures. This is part of its efforts to better control the private fund industry and monitor systemic risk.

Changes proposed to SEC’s Form Private Fund (PF), would make it mandatory that private funds report details on material events within one working day. That is an increase from the current requirement of either a quarterly or an annual basis, depending upon the firm.

Private funds must use Form PF to report purchases or securities sales to the agency.

To capture additional firms, the Draft Rule would lower the Form PF reporting threshold to private equity advisers to $2 billion assets under management. It would be $1.5 billion.

The private funds industry drew fresh scrutiny https://www.reuters.com/article/us-retail-trading-funds-regulation-analy-idUKKBN2A218L after hedge fund de-leveraging contributed toward turmoil in the U.S. Treasuries market in March 2020 and hedge funds were again at the center of last year’s GameStop (NYSE:) “meme-stock” saga.

Although the information would not be disclosed publicly, regulators would benefit from it, including big losses and significant counterparty defaults events. Material changes in prime broker relationships, withdrawals or redemptions as well as material loss.