The SEC continues to emphasize that it is not enough for an adviser to disclose that it “may” engage in a particular practice when it is, in fact, actually engaging in that practice. This is particularly true for disclosures about the adviser’s compensation. A recent SEC settlement is a case in point. An investment adviser disclosed to its investors that it would charge certain up-front fees in connection with fund investments, but it only disclosed that an affiliated broker “may” also receive commissions on fund deals when, in fact, the broker did receive commissions on several deals. This article analyzes the adviser’s allegedly deficient disclosures regarding its compensation and conflicts of interest, as well as the terms of the settlement order. This settlement, which came shortly after the issuance of the SEC’s Interpretation Regarding Standard of Conduct for Investment Advisers, shows the great weight that the SEC places on clear disclosure of conflicts of interest – especially those that are not merely theoretical – when targeting all types of private fund managers. See our three-part series “Navigating the SEC’s Interpretation Regarding an Investment Adviser’s Standard of Conduct”: What It Means to Be a Fiduciary (Dec. 3, 2019); Six Tools to Systematically Identify Conflicts of Interest (Dec. 10, 2019); and Three Tools to Systematically Monitor Conflicts of Interest (Dec. 17, 2019).