Private Investment Funds Partner Quoted on Expansion of ‘Accredited Investor’ Definition in Private Equity International and Private Funds Management

A Feb. 4 article published by both Private Equity International and Private Funds Management details that the US House of Representatives has passed a bill to expand the definition of an “accredited investor.” The piece quotes private investment funds partner Peter Laybourn (Boston) who explains how the bill affects private equity managers, outlining that managers now have a broadened pool of “new investors they can possibly target and let into their funds.” An additional benefit, adds Mr. Laybourn, is that PE firms “may have greater participation from their own employees in their funds.” However, Mr. Laybourn also notes that “the SEC will need to develop a test by which to judge whether or not a person has the ‘professional knowledge’ necessary to qualify.” As a result, it will be some time before the effects of a broader investment pool are felt by the private funds industry.