Securities and Exchange Commission Chairman Paul Atkins said the agency is investigating allegations of fraud in private credit firms, though he declined to say specifically which companies are under scrutiny.
Atkins spoke Monday at the Milken Institute Global Conference, noting the SEC was monitoring the private credit space alongside the US Treasury Department and the Federal Reserve.
“We are taking it seriously, we are monitoring the situation,” Atkins said, adding the agency is examining various firms like the regulator would normally do. “There’s been allegations of fraud and obviously I can’t talk about any specific cases, but we are investigating that as well.”
In addition to discussing potential issues, Atkins touted the benefit of private credit and said the markets serve an as an important source of credit and funding for small and private businesses.
Atkins has previously said the sector is not a systemic risk but noted in April the agency was tracking “emerging pressures” as redemption requests persisted alongside rising projections for defaults.
Firms have sought to reassure investors about risks in the industry, with executives at Blue Owl Capital Inc. last week saying sentiment in private credit is far grimmer than reality.
Written by: Lydia Beyoud @Bloomberg
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