(Bloomberg) -- Hedge funds and private-equity firms have created bogus service providers to boost fees they charge to portfolio companies and investors, SEC Chair Mary Jo White will tell lawmakers in Washington today.
Private funds also have mis-assigned some fees and expenses to companies in which they hold stakes, White said in remarks prepared for a House Financial Services Committee hearing on her agencys 2015 budget. More than half of about 400 private-equity firms that SEC staff have examined have charged unjustified fees and expenses without notifying investors, according to a person familiar with the matter.
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