SEC Pressed by Judges Over Private Fund Fee Disclosure Rules (1)

The US Securities and Exchange Commission is trying to fend off a legal challenge to agency rules requiring hedge funds and private equity firms to detail quarterly fees and expenses to investors.

The regulator faced tough questioning from a three-judge panel as it faced off Monday against the Managed Funds Association and other trade groups in a hearing at the US Fifth Circuit Court of Appeals in New Orleans.

In addition to fee disclosures, the rules adopted by the SEC in August would prohibit firms from allowing some favored investors to cash out more easily than others. The SEC under ...