The Securities and Exchange Commission has intensified its scrutiny of special purpose vehicles (SPVs) that claim to provide investors with exposure to private company shares. This increased regulatory focus follows a rise in investor complaints and promotional activity surrounding SPVs ahead of high-profile initial public offerings, including those of SpaceX and Anthropic.

According to individuals familiar with the matter, SEC examiners have been requesting documentation from registered investment advisers to verify that their SPVs actually hold, or have exposure to, the private company shares they purport to offer. These examinations have involved detailed document reviews and, in some cases, onsite visits, with investigation periods ranging from several weeks to over a year.

SPVs are investment structures that either directly hold shares in private companies or gain exposure indirectly through investments in other funds with such holdings. They have become more common in recent years as startups have delayed going public and investors seek opportunities to participate in their rising valuations. However, SPVs operate with minimal regulation.

While the SEC holds oversight authority over funds managed by registered investment advisers, some SPVs are offered by entities outside of its regulatory scope. Nonetheless, the agency retains investigative powers in cases of suspected fraud.

The heightened regulatory attention comes amid reports of problematic SPV practices. One fund advertising pre-IPO shares of SpaceX later informed investors that the shares had been sold before public trading commenced, which limited anticipated returns. Another firm marketing pre-IPO stakes filed for bankruptcy last year amid ongoing investigations and uncertainty over the actual ownership interests held by its clients.

Concerns about unapproved stock sales via SPVs have also been expressed by private companies themselves. Anthropic, in particular, updated a public statement in May clarifying that it would not recognize any sales of its stock lacking board approval. The company also identified several online platforms that had facilitated the resale of Anthropic shares, both directly and indirectly through SPVs.

The SEC’s stepped-up enforcement signals growing caution toward an increasingly popular but complex segment of private market investing, highlighting the challenges regulators face in ensuring transparency and protecting investors in this evolving space.