In other words, what's to stop an unethical family office from creating all sorts of "new employees" in a bid to bulk up on investment assets?
If Congress ends up taking a hard line with family offices, families anxious to avoid the expense of compliance and loss of privacy that goes with SEC registration may be able to get exemptions--if they meet the old Adviser Act strictures--but the application itself would amount to a compliance hurdle, and come at no small cost.
On the other hand, Yates says that some families with complex structures may find that compliant family offices are more transparent and orderly stewards of their wealth.
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