Interestingly the Tracker magazine published by IFI Global had the following to say about risk and management companies (ManCo’s):
“There is a dearth of risk managers in the jurisdictions where ManCo platforms are based anyway. It is very difficult to find qualified people available to perform the risk oversight function on ManCo platforms (or indeed for regular AIFMs) in the jurisdictions where these are mostly based: Ireland, Luxembourg and Malta. Qualified risk professionals are vital in the AIFMD era but are in short supply. Risk supervision has to be carried out in the jurisdiction where the fund is domiciled. If a regulated AIF collapses and the directors were not able to demonstrate that there was someone qualified to take on the fund’s risk oversight function there could be big trouble.”
So it would appear the ManCo’s need to put some risk substance into their offering otherwise they just become a ManCo for hire (aka a letterbox). The “oversight” model where a designated person reviews the investment managers risk reports may not be acceptable to the regulators for much longer. Increasingly it would seem regulators are expecting designated persons to have relevant risk experience and expertise who can actually drill into the numbers to divine what is actually happening within the fund in terms of risk and take appropriate action where necessary.

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