# Hedge Fund Investor Questionnaire Reviewer Checklist[^about] A reviewer checklist for a hedge fund investor questionnaire, a hedge fund here meaning an open-end private investment fund organized as a Delaware limited partnership and relying on Section 3(c)(1): whether its eligibility questions track the current rules and the fund's admission conditions, what it collects for benefit plan, tax, and anti-money-laundering purposes, the bad-actor and new-issue questions, and how it changes when the investment manager is organized outside the United States. This checklist is written first for the manager of an emerging or small hedge fund who is preparing the investor questionnaire, and second for a smaller investor completing it without counsel of their own. The questionnaire is where the fund learns the facts it relies on to admit an investor, keep its exclusion from the Investment Company Act, charge a performance allocation, and buy new issues. A manager uses the items to check that each question is current and matches the fund's documents; an investor uses them to understand why each question is asked. The subscription agreement has its own [reviewer checklist](/checklists/fund-formation/hedge-fund-subscription-agreement), and the [hedge fund formation practice guide](/practice-guides/fund-formation/us/hedge-funds) explains the rules behind the items. Completing it does not establish that any investor is eligible or that the fund complies with any law, which remain judgments for counsel. ## Eligibility questions {#eligibility-questions} - [ ] **Accredited-investor categories match the current Rule 501(a)** (Recommended) — Compare the accredited-investor categories with the current text of Rule 501(a), not with an older questionnaire. The natural-person net-worth test excludes the primary residence, the income tests have separate individual and joint levels, and the rule now includes professional certifications, knowledgeable employees of the fund, family offices, and entities owning more than $5,000,000 in investments. Status is tested at the time of sale, so confirm the questionnaire is completed for each subscription, including additional contributions. [^accredited-investor-definition] [#track-the-current-accredited-investor-categories] - [ ] **Qualified-client dollar thresholds taken from the most recent Commission order** (Required) — Where the questionnaire screens qualified-client status because the manager is registered or required to be registered and charges a performance allocation, the assets-under-management and net-worth amounts must be those in the Commission's most recent order under Rule 205-3, measured immediately after and immediately before the investor enters the contract. Confirm the questionnaire states the current amounts and the as-of date, and excludes the primary residence from a natural person's net worth. [^qualified-client-definition] [^qualified-client-current-amounts] [#state-the-current-qualified-client-thresholds] - [ ] **Pooled investors: each equity owner bearing the allocation tested** (Required) — For an investor that is a private investment company, a registered investment company, or a business development company, Rule 205-3 treats each equity owner charged the performance compensation as the client. Where the qualified-client screen applies, confirm the questionnaire identifies those investors and collects the status of their equity owners rather than testing only the investing entity. [^qualified-client-look-through-rule] [#look-through-pooled-investors-for-qualified-client-status] - [ ] **Questions cover every admission condition in the partnership agreement** (Recommended) — Confirm the questionnaire asks about every eligibility condition in the limited partnership agreement and no stricter one. If the partnership agreement requires every investor to be a qualified client, the questionnaire asks it of every investor, not only those charged a performance allocation. [#match-the-admission-conditions] - [ ] **Section 3(c)(1) beneficial-owner questions for entity investors** (Recommended) — Confirm an entity investor is asked whether it was formed to invest in the fund, whether the investment exceeds 40% of its assets, whether its owners choose individually whether to invest, and whether it is itself an investment company or a Section 3(c)(1) or 3(c)(7) fund, with the number of its beneficial owners where any answer is yes. These facts let the general partner decide whether to count the investor as one owner or look through it. [^section-3c1-owner-limit] [^section-3c1-company-look-through] [#collect-the-section-3c1-look-through-facts] - [ ] **Section 3(c)(7) fund: qualified-purchaser status at acquisition** (Required) — A fund that relies on Section 3(c)(7) must be owned exclusively by persons who were qualified purchasers when they acquired their interests. If the fund relies on Section 3(c)(7), confirm the questionnaire asks the qualified-purchaser questions of every investor, and that the fund's partnership agreement and memorandum have been conformed to that exclusion. [^section-3c7-exclusion] [#screen-qualified-purchasers-in-a-section-3c7-fund] ## Plan, tax, and anti-money-laundering information {#plan-tax-and-anti-money-laundering-information} - [ ] **Benefit plan status asked by type of plan, with the plan-investor share of an entity** (Recommended) — Confirm the questionnaire asks which kind of plan or account the investor is, or whether it invests plan assets, and, for an investing entity whose assets include plan assets, the percentage of each class of its equity held by benefit plan investors. The general partner needs those facts to apply the 25% test to each class of the fund's interests after every subscription and transfer. [^plan-assets-significant-participation] [#ask-benefit-plan-status-as-facts] - [ ] **Form W-9 or the applicable Form W-8, tax-exempt status, and taxable year** (Recommended) — Confirm the questionnaire asks whether the investor is a United States person and requests a Form W-9 or the applicable Form W-8, whether it is tax-exempt and on what basis, and its taxable year, and that it points to the fund's Foreign Account Tax Compliance Act and Common Reporting Standard self-certification rather than reproducing it. [#request-the-right-tax-form] - [ ] **Beneficial owners and one control person identified for entity investors** (Recommended) — Confirm an entity investor is asked for each individual who owns 25% or more of it and one individual with significant responsibility for managing it, with identifying information, and that the questionnaire reserves the fund's right to request documents to verify them and the source of funds. Match the questions to the fund's and administrator's actual onboarding procedures. [#identify-beneficial-owners-and-a-control-person] - [ ] **Sanctions list, Section 311 jurisdiction, senior foreign political figure, and shell bank questions** (Recommended) — Confirm the questionnaire asks, for the investor and its identified owners and control person, whether any of them is on the Office of Foreign Assets Control's sanctions lists, is in a jurisdiction subject to a special measure under Section 311 of the USA PATRIOT Act, is a senior foreign political figure or a family member or close associate of one, or is or banks through a foreign shell bank, with an explanation for any yes. [#screen-sanctions-and-political-exposure] ## Bad-actor, new-issue, and public-records questions {#bad-actor-new-issue-and-public-records-questions} - [ ] **Rule 506(d) disqualification questions for a prospective 20% holder** (Required) — A beneficial owner of 20% or more of the fund's outstanding voting equity securities, calculated on the basis of voting power, is a covered person under Rule 506(d), and the reasonable-care exception requires factual inquiry. Because ownership can be direct or indirect, confirm the questionnaire identifies each person that would reach the threshold through the investor, with its ownership chain and percentage calculated by voting power as the rule does, and asks each of them about the disqualifying events and their dates. [^bad-actor-covered-persons] [^bad-actor-factual-inquiry] [#ask-rule-506d-questions-of-large-holders] - [ ] **FINRA Rule 5130 restricted-person and exemption questions** (Recommended) — Confirm the questionnaire asks whether the investor or anyone with a beneficial interest in it falls in a Rule 5130 restricted-person category, what share of the investor those persons hold, and whether the investor is an exempt account. The immediate-family categories turn on material support, which Rule 5130 deems to exist between family members living in the same household, so confirm the questions collect household as well as income facts. [^new-issue-material-support] A broker-dealer must obtain a representation within twelve months before selling the fund a new issue, so the fund also needs a way to refresh the answers at least annually. [^new-issue-restriction] [^new-issue-representation] [#ask-the-rule-5130-restricted-person-questions] - [ ] **FINRA Rule 5131 executive officer and director question** (Recommended) — Confirm the questionnaire asks whether the investor, or anyone with a beneficial interest in it, is an executive officer or director of a public company or a covered non-public company, or is materially supported by one, and which companies. Rule 5131 treats people in the same household as materially supporting each other, so confirm the question reaches a household member regardless of income, and asks the listing and financial facts that decide whether a company is covered. [^anti-spinning-material-support] Rule 5130 status does not answer this question. [^anti-spinning-restriction] [#ask-the-rule-5131-covered-person-question] - [ ] **Public-records law status and the laws involved** (Recommended) — Confirm the questionnaire asks whether the investor is subject to the Freedom of Information Act, a state public-records law, or a similar law, and which ones, so the general partner can decide what confidential information to share with it. [#ask-public-records-status] ## How the questionnaire is written {#how-the-questionnaire-is-written} - [ ] **Questions about facts, with the general partner applying the definitions** (Recommended) — Check that each question asks for a fact the investor knows or can find out, such as an amount, a relationship, a license held, a form filed, or an event and its date, rather than for a bare conclusion, such as a statement that the investor is not a restricted person. Where a legal category has to be named, the question should describe it in terms of those facts. This makes the answers more reliable and makes an error easier to trace. [#ask-for-facts-the-investor-knows] - [ ] **Duty to update, and a refresh for each additional contribution** (Recommended) — Confirm the questionnaire requires the investor to report when an answer stops being accurate, and that the fund's process asks for a confirmation or new questionnaire with each additional contribution and at least annually for the new-issue answers. Eligibility is tested at each sale, so a questionnaire completed on first subscription does not by itself cover a later contribution. [#require-updates-and-annual-refresh] ## Investment manager outside the United States {#questionnaire-with-an-investment-manager-outside-the-united-states} - [ ] **Drafting note: which questions change for a manager outside the United States** (Recommended) — Where the investment manager is organized and regulated outside the United States, confirm where its principal office and place of business is, since the non-U.S. private fund adviser exemption turns on that rather than on where the manager is organized, and then confirm its status under the Investment Advisers Act first: registered with the Commission, exempt as a non-U.S. private fund adviser, or a foreign private adviser. Then adjust the questionnaire: 1. The qualified-client section is a legal requirement only for a manager registered or required to be registered with the Commission. For a manager that is neither, keep it if the partnership agreement requires it as an admission condition, and state the assets-under-management question in terms of assets under that manager's management. 2. A foreign private adviser must have fewer than 15 U.S. clients and investors, and less than $25 million attributable to them, so ask each investor whether it is in the United States and count U.S. investors across all of the manager's private funds, not only this one. 3. Keep the tax, anti-money-laundering, benefit plan, bad-actor, and new-issue questions, which depend on the fund and its investors rather than on where the manager is based, and add any information the manager's home regulator requires. 4. If the manager's home law regulates its processing of investor data, add the notice that law requires. [^non-us-adviser-exemption-rule] [^foreign-private-adviser-terms] [^performance-fee-prohibition-scope] [#adjust-questions-for-a-non-us-investment-manager] [^about]: By Steven Obiajulu, J.D. Published by [openagreements.org](https://openagreements.org). Last reviewed 2026-09-30. License: CC BY 4.0. Steven Obiajulu, J.D. edits this reviewer checklist for U.S. hedge fund investor questionnaire for a fully funded, open-end fund, read with its subscription agreement and limited partnership agreement. Not a closed-end drawdown fund such as a private equity fund coverage. It synthesizes legal sources and is not legal advice. This article is for informational purposes only and does not create an attorney-client relationship. Source excerpts and linked materials belong to their owners. CC BY 4.0. Cite as Steven Obiajulu, *Hedge Fund Investor Questionnaire Reviewer Checklist*, OpenAgreements (last updated September 30, 2026), https://openagreements.org/checklists/fund-formation/hedge-fund-investor-questionnaire. [^accredited-investor-definition]: **17 CFR 230.501(a): Accredited investor** — "§ 230.501 Definitions and terms used in Regulation D. As used in Regulation D (§ 230.500 et seq. of this chapter), the following terms shall have the meaning indicated: (a) Accredited investor. Accredited investor shall mean any person who comes within any of the following categories, or who the issuer reasonably believes comes within any of the following categories, at the time of the sale of the securities to that person:" *17 C.F.R. § 230.501(a).* [^qualified-client-definition]: **17 CFR 275.205-3(d)(1)(i): Qualified client by assets under management** — "(1) The term qualified client means: (i) A natural person who, or a company that, immediately after entering into the contract has, under the management of the investment adviser, at least the applicable dollar amount specified in the most recent order; (ii) A natural person who, or a company that, the investment adviser entering into the contract (and any person acting on his behalf) reasonably believes, immediately prior to entering into the contract, either:" *17 C.F.R. § 275.205-3(d)(1)(i)-(ii).* [^qualified-client-current-amounts]: **SEC Order IA-6961: 2026 qualified-client dollar thresholds** — "IT IS HEREBY ORDERED that, for purposes of rule 205-3(d)(1)(i) under the Advisers Act [17 CFR 275.205-3(d)(1)], a qualified client means a natural person who, or a company that, immediately after entering into the contract has at least $1,400,000 under the management of the investment adviser; and IT IS FURTHER ORDERED that, for purposes of rule 205-3(d)(1)(ii)(A) under the Advisers Act [17 CFR 275.205-3(d)(1)(ii)(A)], a qualified client means a natural person who, or a company that, the investment adviser entering into the contract (and any person acting on his behalf) reasonably believes, immediately prior to entering into the contract, has a net worth (together, in the case of a natural person, with assets held jointly with a spouse) of more than $2,700,000." *Order Approving Adjustment for Inflation of the Dollar Amount Tests in Rule 205-3 Under the Investment Advisers Act of 1940, Advisers Act Release No. IA-6961, § IV (Apr. 28, 2026).* [^qualified-client-look-through-rule]: **17 CFR 275.205-3(b): Identification of the client** — "In the case of a private investment company, as defined in paragraph (d)(3) of this section, an investment company registered under the Investment Company Act of 1940, or a business development company, as defined in section 202(a)(22) of the Act (15 U.S.C. 80b-2(a)(22)), each equity owner of any such company (except for the investment adviser entering into the contract and any other equity owners not charged a fee on the basis of a share of capital gains or capital appreciation) will be considered a client for purposes of paragraph (a) of this section." *17 C.F.R. § 275.205-3(b).* [^section-3c1-owner-limit]: **15 U.S.C. § 80a-3(c)(1): Private-fund exclusion** — "Notwithstanding subsection (a), none of the following persons is an investment company within the meaning of this subchapter: (1) Any issuer whose outstanding securities (other than short-term paper) are beneficially owned by not more than one hundred persons (or, in the case of a qualifying venture capital fund, 250 persons) and which is not making and does not presently propose to make a public offering of its securities." *15 U.S.C. § 80a-3(c)(1).* [^section-3c1-company-look-through]: **15 U.S.C. § 80a-3(c)(1)(A): Company-investor look-through** — "Beneficial ownership by a company shall be deemed to be beneficial ownership by one person, except that, if the company owns 10 per centum or more of the outstanding voting securities of the issuer, and is or, but for the exception provided for in this paragraph or paragraph (7), would be an investment company, the beneficial ownership shall be deemed to be that of the holders of such company's outstanding securities (other than short-term paper)." *15 U.S.C. § 80a-3(c)(1)(A).* [^section-3c7-exclusion]: **15 U.S.C. § 80a-3(c)(7)(A): Qualified-purchaser private-fund exclusion** — "Any issuer, the outstanding securities of which are owned exclusively by persons who, at the time of acquisition of such securities, are qualified purchasers, and which is not making and does not at that time propose to make a public offering of such securities." *15 U.S.C. § 80a-3(c)(7)(A).* [^plan-assets-significant-participation]: **29 CFR 2510.3-101(f)(1): Significant participation by benefit plan investors** — "Equity participation in an entity by benefit plan investors is ‘significant’ on any date if, immediately after the most recent acquisition of any equity interest in the entity, 25 percent or more of the value of any class of equity interests in the entity is held by benefit plan investors (as defined in paragraph (f)(2))." *29 C.F.R. § 2510.3-101(f)(1).* [^bad-actor-covered-persons]: **17 CFR 230.506(d)(1): Bad-actor disqualification** — "No exemption under this section shall be available for a sale of securities if the issuer; any predecessor of the issuer; any affiliated issuer; any director, executive officer, other officer participating in the offering, general partner or managing member of the issuer; any beneficial owner of 20% or more of the issuer's outstanding voting equity securities, calculated on the basis of voting power; any promoter connected with the issuer in any capacity at the time of such sale; any investment manager of an issuer that is a pooled investment fund; any person that has been or will be paid (directly or indirectly) remuneration for solicitation of purchasers in connection with such sale of securities; any general partner or managing member of any such investment manager or solicitor; or any director, executive officer or other officer participating in the offering of any such investment manager or solicitor or general partner or managing member of such investment manager or solicitor:" *17 C.F.R. § 230.506(d)(1).* [^bad-actor-factual-inquiry]: **17 CFR 230.506(d)(2)(iv) and instruction: Reasonable care** — "An issuer will not be able to establish that it has exercised reasonable care unless it has made, in light of the circumstances, factual inquiry into whether any disqualifications exist." *17 C.F.R. § 230.506(d)(2)(iv), instruction.* [^new-issue-material-support]: **FINRA Rule 5130(i)(8): Material support** — "‘Material support’ means directly or indirectly providing more than 25% of a person's income in the prior calendar year. Members of the immediate family living in the same household are deemed to be providing each other with material support." *FINRA Rule 5130(i)(8).* [^new-issue-restriction]: **FINRA Rule 5130(a)(1): Restrictions on the purchase and sale of initial equity public offerings** — "A member or a person associated with a member may not sell, or cause to be sold, a new issue to any account in which a restricted person has a beneficial interest, except as otherwise permitted herein." *FINRA Rule 5130(a)(1).* [^new-issue-representation]: **FINRA Rule 5130(b): Preconditions for sale** — "Before selling a new issue to any account, a member must in good faith have obtained within the twelve months prior to such sale, a representation from: (1) Beneficial Owners the account holder(s), or a person authorized to represent the beneficial owners of the account, that the account is eligible to purchase new issues in compliance with this Rule; or (2) Conduits a bank, foreign bank, broker-dealer, or investment adviser or other conduit that all purchases of new issues are in compliance with this Rule." *FINRA Rule 5130(b).* [^anti-spinning-material-support]: **FINRA Rule 5131(e)(6): Material support** — "‘Material support’ means directly or indirectly providing more than 25% of a person's income in the prior calendar year. Persons living in the same household are deemed to be providing each other with material support." *FINRA Rule 5131(e)(6).* [^anti-spinning-restriction]: **FINRA Rule 5131(b)(1): Spinning** — "No member or person associated with a member may allocate shares of a new issue to any account in which an executive officer or director of a public company or a covered non-public company, or a person materially supported by such executive officer or director, has a beneficial interest: (A) if the company is currently an investment banking services client of the member or the member has received compensation from the company for investment banking services in the past 12 months;" *FINRA Rule 5131(b)(1)(A).* [^non-us-adviser-exemption-rule]: **17 CFR 275.203(m)-1(b): Non-United States private fund advisers** — "(b) Non-United States investment advisers. For purposes of section 203(m) of the Act (15 U.S.C. 80b-3(m)), an investment adviser with its principal office and place of business outside of the United States is exempt from the requirement to register under section 203 of the Act if: (1) The investment adviser has no client that is a United States person except for one or more qualifying private funds; and (2) All assets managed by the investment adviser at a place of business in the United States are solely attributable to private fund assets, the total value of which is less than $150 million." *17 C.F.R. § 275.203(m)-1(b).* [^foreign-private-adviser-terms]: **Investment Advisers Act of 1940 § 202(a)(30), 15 U.S.C. § 80b-2(a)(30)** — "The term ‘foreign private adviser’ means any investment adviser who- (A) has no place of business in the United States; (B) has, in total, fewer than 15 clients and investors in the United States in private funds advised by the investment adviser; (C) has aggregate assets under management attributable to clients in the United States and investors in the United States in private funds advised by the investment adviser of less than $25,000,000, or such higher amount as the Commission may, by rule, deem appropriate in accordance with the purposes of this subchapter; and" *15 U.S.C. § 80b-2(a)(30)(A)-(C).* [^performance-fee-prohibition-scope]: **Investment Advisers Act of 1940 § 205(a)(1), 15 U.S.C. § 80b-5(a)(1)** — "No investment adviser registered or required to be registered with the Commission shall enter into, extend, or renew any investment advisory contract, or in any way perform any investment advisory contract entered into, extended, or renewed on or after November 1, 1940, if such contract- (1) provides for compensation to the investment adviser on the basis of a share of capital gains upon or capital appreciation of the funds or any portion of the funds of the client;" *15 U.S.C. § 80b-5(a)(1).*