The use of special purpose acquisition companies (SPACs) grew exponentially in 2020, and that trend has continued into 2021. SPACs are increasingly used to take companies public in place of traditional IPOs and are attracting more interest from sponsors as an alternative approach to generating alpha. In turn, they are also garnering added scrutiny from the SEC, institutional investors and target companies that are wary of certain downsides of the SPAC craze. To delve into those issues at greater length, the Investment Management Due Diligence Association (IMDDA) recently hosted a webinar on SPACs moderated by Daniel Strachman, co‑founder of IMDDA, and featuring Milton A. Vescovacci, shareholder at Gunster; Kelly DePonte, managing director at Probitas Partners; and Gordon Hargraves, senior partner at Novacap. This second article in a two-part series addresses conflicts of interest of which investors should be wary when considering SPAC investments, SEC scrutiny of the vehicles and factors that may stunt PE sponsors’ interest in launching SPACs. The first article described key features and mechanics of SPAC vehicles; the range of outcomes of SPAC investments; and various related trends, including the rise of non‑U.S. SPACs. For coverage of other IMDDA events, see “IMDDA Offers Fund Managers a Blueprint for Conducting Sexual Harassment Due Diligence” (Aug. 2, 2018); and “How Due Diligence Professionals Approach the Private Fund Review Process” (Jun. 15, 2017).