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Private Equity’s Opaque Costs Mystify the Pensions That Pay Them

On top of management fees, investors pay for a variety of funds’ business expenses, from travel to research to “other.” 

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The stewards of billions of dollars in retiree savings are struggling to account for fees charged by one of the wealthiest industries on Wall Street.

Investors who put money into a private equity fund expect to pay a management fee as well as a share of their profits to the firm running the fund. But on top of those costs are agreements to cover expenses ranging from dealmaker travel to dinners to news subscriptions. And it’s proving difficult to determine how those dollars are spent.