Regulatory Pivot: SEC and CFTC Propose Sweeping Reforms to Private Fund Reporting

WASHINGTON, D.C. — April 20, 2026 — In a significant shift toward regulatory recalibration, the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) have jointly announced a proposal to overhaul Form PF—the confidential reporting mechanism used to monitor systemic risk within the private fund industry. The proposed amendments represent a concerted effort by the federal agencies to prune the bureaucratic thicket that has increasingly constrained private fund advisers, aiming to strike a more efficient balance between necessary market oversight and operational autonomy.

This move marks a departure from recent years of intensifying reporting requirements, signaling a new era of "regulatory rationalization" under the current administration. By significantly elevating filing thresholds and streamlining data points, the agencies intend to reduce the administrative drag on the industry while maintaining visibility into the systemic risks posed by the largest market players.

The Core Proposals: Scaling Back and Streamlining

The primary objective of the proposed amendments is to recalibrate the scope of Form PF to ensure that the data collected remains relevant and actionable for the Financial Stability Oversight Council (FSOC). Under the existing regime, the sheer volume of data gathered from smaller advisers has been criticized as redundant and resource-intensive.

Raising the Filing Thresholds

The most impactful change proposed by the commissions is the dramatic increase in the assets under management (AUM) thresholds required for filing.

• Small Adviser Relief: Currently, advisers with $150 million in private fund AUM are required to file Form PF. The proposed amendment would raise this bar to $1 billion. This shift alone would exempt nearly half of the current filer population from the obligation, effectively allowing smaller firms to reallocate compliance capital toward investment research and growth initiatives.
• Hedge Fund Exposure: The definition of "large" hedge fund advisers—those subject to the most rigorous disclosure requirements—would also see a significant adjustment. The AUM threshold for these entities would jump from $1.5 billion to $10 billion.

Despite these exclusions, the agencies emphasize that the core purpose of Form PF remains intact. Officials estimate that even with the new thresholds, the amended form will continue to capture data on more than 90 percent of total private fund gross assets. This ensures that while the "long tail" of smaller firms is freed from reporting, the "systemically important" entities remain firmly in the crosshairs of federal oversight.

Identifying the Private Credit Boom

A critical addition to the revised form involves the inclusion of a specific identification method for funds active in the private credit market. As non-bank lending has surged in recent years, regulators have struggled to gain a granular view of exposure within this opaque sector. By formalizing the identification of private credit vehicles on Form PF, the SEC and CFTC aim to map the interconnectedness of this sector without requiring overly burdensome general disclosures from firms that do not pose a systemic threat.

A Chronology of Regulatory Friction

To understand the weight of this proposal, one must look at the trajectory of Form PF since its inception. Originally established in the wake of the 2008 financial crisis, Form PF was designed to give the FSOC a window into the "shadow banking" system.

• 2011–2012: The SEC and CFTC jointly adopted Form PF, marking the first time private fund advisers were required to report confidential information on their strategies, leverage, and counterparty exposure.
• 2022–2024: Following a period of market volatility, the commissions pushed through a series of amendments that significantly increased the frequency and granularity of reporting, particularly regarding "event-driven" disclosures. These changes were met with fierce pushback from industry groups, who argued that the compliance costs were becoming disproportionate to the risk management value provided.
• 2025: Industry advocacy groups and trade associations intensified lobbying efforts, citing that the "disclosure creep" was hampering the competitiveness of U.S. investment firms.
• April 2026: The current proposal serves as the first major legislative "correction," acknowledging the industry’s concerns regarding compliance fatigue.

Supporting Data and Rationale

The commissions’ decision is supported by a growing consensus that the previous "one-size-fits-all" approach to systemic risk monitoring was inefficient. Internal agency reviews suggested that data provided by smaller funds often remained siloed or unused because the firms simply lacked the reach to trigger systemic instability.

By focusing on the $10 billion threshold for large hedge fund advisers, the agencies are concentrating their resources on the institutions most capable of transmitting shocks across the financial ecosystem. The data suggests that systemic risk is heavily concentrated at the top end of the market; therefore, the marginal utility of data from the bottom 50 percent of filers was found to be statistically low.

Furthermore, the streamlining of requirements—which includes the elimination of redundant data fields—is expected to significantly reduce the cost of compliance for mid-sized firms that will still fall under the filing umbrella. For these firms, the burden of data aggregation, verification, and legal review has historically required substantial investment in third-party compliance software and consultancy.

Official Responses: Restoring the Balance

The announcement has been framed by agency leadership as a strategic pivot toward fiscal and operational efficiency.

SEC Chairman Paul S. Atkins

SEC Chairman Paul S. Atkins was vocal regarding the necessity of this shift. "A key pillar of my agenda is restoring balance to disclosure obligations and reducing the cost of compliance wherever possible," Atkins stated during the press briefing. He criticized the previous trajectory of Form PF, noting that "prior amendments have led to overly burdensome disclosure requirements for advisers, distracting them from their core investment functions, often without a commensurate benefit to regulators’ use of the collected data."

Atkins emphasized that the goal is not to abandon oversight, but to "rationalize the scope" of the regime. By removing the noise created by small-firm data, the SEC expects its enforcement and oversight teams to be more agile in responding to genuine market risks.

CFTC Chairman Michael S. Selig

CFTC Chairman Michael S. Selig echoed these sentiments, focusing on the procedural relief offered by the proposal. "By raising the filing threshold and streamlining Form PF, we are taking steps to reduce the burdens associated with filing the form," Selig said. He highlighted the importance of the public comment period, noting that the agencies are genuinely seeking feedback to ensure that the "elimination of unnecessary costs and burdens" does not come at the expense of necessary transparency.

Implications for the Financial Industry

The proposed changes carry profound implications for the asset management landscape, particularly for mid-sized private equity and hedge funds that were previously on the cusp of heavy regulatory scrutiny.

1. Operational Cost Reduction

The most immediate impact will be the reduction in operational overhead. For firms that will no longer meet the filing threshold, the cost savings—ranging from internal man-hours to external legal fees—could be redirected toward capital deployment or talent acquisition.

2. Strategic Focus

By narrowing the focus of Form PF, advisers may find it easier to comply with remaining requirements. The "streamlining" of the form implies that the commissions intend to prune legacy questions that are no longer deemed critical to the FSOC’s mission. This creates a clearer compliance roadmap for firms that remain within the reporting scope.

3. Monitoring the Private Credit Sector

The inclusion of private credit tracking represents a targeted effort to modernize the reporting regime. As traditional banking becomes more restricted, private credit has stepped into the void. This move suggests that while the SEC and CFTC are relaxing broad requirements, they are simultaneously sharpening their focus on specific areas of the market that are currently experiencing rapid growth and potential maturity.

4. Market Sentiment

Early reactions from industry associations, such as the Managed Funds Association (MFA) and the Investment Adviser Association (IAA), have been cautiously optimistic. While these organizations have historically argued for even broader exemptions, the move is widely viewed as a "course correction" that acknowledges the reality of the administrative burden facing private funds in the current interest-rate environment.

Looking Ahead: The Comment Process

The proposed amendments have now entered the public record. The release is slated for publication in the Federal Register, triggering a 60-day window for public commentary.

Regulators have signaled an openness to adjusting the final rule based on industry feedback. Specifically, the commissions are inviting comments on:

• The appropriateness of the $1 billion and $10 billion thresholds.
• The specific data points that should be streamlined or removed.
• The potential challenges associated with the new identification requirements for private credit funds.

As the industry prepares to digest the proposal, the atmosphere in Washington remains one of transition. For the private fund sector, the coming months represent a rare opportunity to help shape the regulatory environment in a way that balances the necessity of systemic risk oversight with the pragmatism of modern market operations.

For now, the message from the SEC and CFTC is clear: the era of reflexive reporting expansion has reached a ceiling. The focus is shifting from "how much data can we collect" to "what data do we actually need to keep the markets safe." Whether this balance holds will depend on the strength of the forthcoming public discourse and the agencies’ final determination on where the line of "systemic importance" truly lies.