SEC sends subpoenas to Wall Street banks over Situational Awareness fund — Fortune
The U.S. Securities and Exchange Commission (SEC) has sent subpoenas to major Wall Street banks in connection with the Situational Awareness hedge fund. The regulator is seeking information about the fund's trading activity, Fortune reports, citing people familiar with the matter.
Request regarding the fund's operations
According to the publication's sources, the SEC is interested in Situational Awareness's operations after the fund came under pressure last month and was forced to exit many positions. The New York Times previously reported on the SEC subpoenas.
An SEC spokesperson declined to comment. As Fortune notes, the regulator's request does not mean that a company or an individual is the subject of an investigation. The SEC review may also conclude without enforcement action.
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Liquidation of positions
Situational Awareness began liquidating some stock positions after a series of margin calls during last month's sell-off in shares of artificial intelligence companies. Ken Griffin's Citadel acquired the bulk of the fund's public equity positions.
In a statement on Monday, Situational Awareness said regulators may closely scrutinize prominent funds that show substantial gains or particularly sharp drawdowns. The fund added that it operates in a highly regulated environment and will fully cooperate with any regulatory request.
