Federal prosecutors are scrutinizing valuation practices at a BlackRock Inc. private credit fund, according to people with knowledge of the matter.
The Manhattan US Attorney’s office in recent months has been seeking information about BlackRock TCP Capital Corp., a publicly traded business development company, said the people, who asked not to be identified discussing a private matter. Executives have been questioned as part of the probe, one of the people said.
A representative for BlackRock declined to comment. A spokesperson for the Southern District of New York didn’t respond to a request for comment.
Jay Clayton, who runs the SDNY, said in November he was concerned about how firms value private assets — and that “people should know that the financial regulators and the department are looking at those.”
This week, while downplaying concerns about an imminent financial crisis from private credit, Clayton reiterated at a Managed Funds Association conference that “if people are mismarking in order to generate fees, that’s always been a no-no.”
