The unrelated position mismarking incidents that quickly precipitated the closures of both Visium Asset Management and Marinus Capital have been recent focal points for market participants, but regulatory scrutiny of valuation choices for less liquid instruments is certainly not new. Askin, Piper Capital Management, and other market participants have also faced high profile regulatory/legal consequences when valuation issues exceeded regulatory tolerances (see the walk down memory lane below). However, even market participants who have had the good fortune of avoiding Wall Street Journal headlines likely still face challenges on a daily basis when marking less liquid and hard-to-value positions.
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