The Securities and Exchange Commission is weighing whether to let Certified Financial Planners, CFA charterholders and CPAs qualify as accredited investors, as well as expand rules governing performance-based fees and liquidity within certain interval fund structures.
The idea is part of a broader federal push to move private-market strategies into funds sold to ordinary investors.
On Wednesday, the commission voted to propose rule amendments that expand retail investor choice and promote innovation in regulated fund structures. One of the formal rule proposals would widen the circumstances in which registered investment advisors may collect performance fees, while the other overhauls the interval fund framework and makes it easier for closed-end funds to offer multiple share classes.
At the same meeting, the SEC separately requested public comment on expanding the accredited investor definition to include more professional certifications, designations or credentials.
"The Commission's efforts in this regard – focused on expanding opportunities for investors' post-tax, pre-retirement dollars – complement efforts undertaken pursuant to President Trump's Executive Order on Democratizing Access to Alternative Assets for 401(k) Investors," said SEC Chairman Paul S. Atkins.
The accredited investor label controls access to private placements. Today it rests mostly on wealth tests: an individual generally must earn more than $200,000 a year, or $300,000 with a spouse, or have a net worth above $1 million excluding a primary residence. Apart from those, the SEC has already designated the Series 7, Series 82 and Series 65 licenses as qualifying credentials.
The SEC is now considering five new routes to the accredited investor label: a U.S. CPA license, a CFA charter, a CFP certification in the United States, the FINRA Series 79 investment banking license, and the FINRA Series 86 and 87 research analyst licenses.
The commission is also asking for comment on an accredited investor exam that FINRA would develop, which would give investors a non-financial way to show they are sophisticated enough to judge a private investment. If that comes to pass, it could make more clients who don't meet the wealth tests eligible for private offerings, which means more advisor-client conversations around suitability.
"I agree with the fundamental notion ingrained in today's notices that accredited investor access to private offerings should not be limited solely to individuals satisfying financial thresholds and that such thresholds are not the sole indicators of a person's ability to assess the merits and risks of an investment," Atkins said at the SEC meeting on Wednesday.
While performance-based pay has long been a fixture in hedge funds and private equity – think of the "2 and 20" structure typically ascribed to traditional hedge funds – the SEC is contemplating amendments allowing investment advisers to regulated funds to earn performance-based compensation, with certain conditions.
As explained in a fact sheet accompanying the proposed rule revisions, the performance-based compensation should not exceed 20% of the fund's net gains over a specified period. The fund would also have to meet the governance standards in Rule 0-1(a)(7). In addition, the fund's board, including a majority of independent directors, would have to find that the arrangement is in shareholders' best interest and make specific findings about its structure and investor protection features.
The proposals also seek to revise the definition of "qualified clients" to capture anyone who meets the accredited investor definition under Regulation D, while eliminating the separate net worth and assets-under-management tests. In practice, that would align eligibility for performance fees with eligibility for private placements.
Funds would also have to disclose performance fees in their registration and reporting forms.
"Performance-based compensation can offer a rational and effective means to define and align adviser and investor goals," Atkins said.
Interval funds are a large and growing part of how advisors access private markets. Research from Alternative Fund Advisors found that 80% of RIAs used interval funds as their main vehicle for private credit in 2025, up from 58% the year before.
The SEC pointed to restrictions in the current rules around interval funds. In particular, rule 23c-3 allows repurchase offers only on a quarterly, semiannual or annual schedule, and each offer must be between 5% and 25% of outstanding shares.
The SEC's proposal would add monthly intervals, allow more frequent discretionary repurchases, and permit a longer delay before a fund's first repurchase offer. It would also let funds deduct deferred sales loads from repurchase proceeds, in certain cases, and replace the rule's fixed liquidity requirement with a principles-based approach.
A separate piece of the proposal would let regulated closed-end funds offer multiple share classes and pay asset-based distribution and service fees. It would also require enhanced expense disclosures across all regulated closed-end funds. That rules-based system would replace the fund-by-fund exemptive orders sponsors currently have to obtain.
"Taken together, these proposals are important steps towards providing individual investors with more access to private market investment opportunities, including through the registered fund channel," Atkins said.
The SEC has opened a 60-day comment period on its proposed rules.
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