Under Advisers Act Rule 206(4)-7, registered hedge fund managers are required to designate a chief compliance officer (CCO), but they are not required to hire an additional executive to serve in that capacity.  Instead, they can assign the CCO role to an existing executive in another role – for example, the general counsel – so long as that person has, in the language of the rule release, “sufficient seniority and authority within the organization to compel others to adhere to the compliance policies and procedures.”  See “Simon Lorne, Chief Legal Officer of Millennium Management LLC, Discusses the Evolving Roles, Challenges and Risks Faced by Hedge Fund Manager General Counsels and Chief Compliance Officers,” Hedge Fund Law Report, Vol. 6, No. 37 (Sep. 26, 2013).  However, even a person with sufficient seniority and authority may not have sufficient time to discharge the duties of a CCO effectively, especially in larger or more complex management companies.  Similarly, “single hatted” CCOs – those with the CCO title and no other – may find their resources taxed and their experience bounded in light of the growth or complexity of the management company.  In short, even a well-staffed compliance function at a hedge fund manager may need to be supplemented with external resources.  Not surprisingly, an industry of compliance consultants and outsourced compliance service providers has arisen to serve this demand.  A relatively new entrant into this industry – albeit one affiliated with an old accounting name – is EisnerAmper Compliance and Regulatory Services, LLC, or CARS.  The Hedge Fund Law Report recently conducted an interview with the principals of CARS – Gary Swiman and Carmine Angone – in an effort to understand where CARS and similar services fit within the hedge fund compliance ecosystem.  In particular, we asked Swiman and Angone for their views on: how an outsourced compliance service provider can be effective if it is not on the ground on a day-to-day basis; conflicts inherent in a compliance service provider’s affiliation with an accounting firm, and how to handle those conflicts; pricing of outsourced compliance services, and measuring the effectiveness of such services; assessing hedge fund enterprise risk; mitigating conflicts raised by dual registration as an investment adviser and broker-dealer; allocating expenses at private equity firms; compliance challenges for family offices; anti-money laundering considerations for hedge fund managers; and the skill sets and backgrounds that should be present among the staff at an outsourced compliance firm.