Need to Meet: Rosemary Fanelli, Managing Director, Duff & Phelps

  • Sold compliance consulting business CounselWorks to Duff & Phelps in 2016
  • Expertise in buy-side and sell-side regulations
  • Developed relationships with SEC and Congressional committees

In late 2006, Rosemary Fanelli launched a compliance consulting business called CounselWorks. She had been the chief compliance officer of investment bank Allen & Co — a position in which “I was able to become extremely familiar with both sell-side and buy-side regulations,” she said — when her soon-to-be partner approached her about setting out on their own.

“We launched a new business and headed straight into the financial crisis,” Fanelli recalled, “so it was a time of great upheaval and great change.”

The original idea was “to provide traditional compliance consulting services in a more sophisticated fashion and a broader context.” But that mission shifted slightly as the fledgling company found itself “with an abundance of opportunities to support back offices that had been decimated by the crisis.”

At the same time, the industry was clamoring for insight into then-President Barack Obama’s legislative goals, as the administration worked to assemble a regulatory package that would dramatically change what was expected of financial firms.

“Once the Dodd-Frank Act was implemented,” Fanelli said, “then the business simply took off.” Not only was there a host of new obligations to meet, but many mandated rules hadn’t even been written yet. Clients were looking for big-picture advice that could help them understand what was in the offing.

Towards that end, CounselWorks “reached out and partnered with the regulators and the legislators,” providing training to SEC examiners and conferring with congressional committees. “We helped them understand how the industry works, and by doing so, we were able to help our clients better understand how the government works,” Fanelli explained.

As the business grew, clients began asking about regulation overseas. “We started to have a need for a more global and more comprehensive service,” which led to CounselWorks being acquired in January 2016 by Duff & Phelps.

At D&P, Fanelli is chief regulatory affairs strategist. “Firms come to us because they’re launching or spinning out and they want to understand: What is the regulated world that they’re entering? They want to set up their firm in a way that will give them credibility and respectability in the investor marketplace. We’ll walk them through what we see as necessary.” That includes staffing, marketing materials, disclosures and registration with the appropriate entity.

Fanelli said the SEC remains focused on expense allocation and conflicts of interest in PE. “We see continued focus on relationships with operating partners: Are they participating in investment management committees? Do they do more than simply sourcing deals? If they are sourcing deals, how are they compensated? That gives rise to broker-dealer questions.”

From the agency’s new leadership, she expects “a relaxation of certain requirements around capital raising. … Chairman [Jay] Clayton really does believe that making market liquidity more available and less complicated is good for everybody.” During his confirmation hearing Clayton expressed disapproval of “regulations that are unnecessarily complex,” and Fanelli expects an effort to clarify certain rules: “He wants to avoid any perception the industry would have of a ‘gotcha’ mentality.”

Phone: +1 212-983-7710

Photo of Rosemary Fanelli courtesy of Duff & Phelps