SEC’s Top Cop Concerned About Private Credit Valuations, Opacity

The booming private credit market is of growing concern to the top enforcement official at the US Securities and Exchange Commission.

During a wide-ranging interview this week, Gurbir Grewal said he sees a range of potential risks in the $1.7 trillion private-lending industry. The enforcement chief signaled everything from market concentration to the way assets are valued will face more scrutiny.

“I’m concerned about valuation issues: how they’re marking these investments because they are illiquid,” Grewal said. “I’m concerned about — as we would be with other private funds — fee and expense issues, and with conflict-of-interest issues.”