CORRESP 1 filename1.htm

December 21, 2006

BY HAND AND BY EDGAR
Jennifer Hardy, Esq.
Division of Corporation Finance
Securities and Exchange Commission
Mail Stop 7010
100 F Street N.E.
Washington, D.C. 20549

RE: Fortress Investment Group LLC
Amendment No. 1 to Registration Statement on Form S-1
(File No. 333-138514)
-----------------------------------------------------

Dear Ms. Hardy:

On behalf of Fortress Investment Group LLC, a Delaware limited
liability company (the "Company"), enclosed is a copy of Amendment No. 1 to the
above-referenced Registration Statement (the "Registration Statement"), as filed
with the Securities and Exchange Commission (the "Commission") on the date
hereof, marked to show changes from the Registration Statement on Form S-1 filed
with the Commission on November 8, 2006.

The changes reflected in the Registration Statement include those made
in response to the comments (the "Comments") of the staff of the Commission (the
"Staff") set forth in the Staff's letter of December 8, 2006 (the "Comment
Letter"). The Registration Statement also includes other changes that are
intended to update, clarify and render more complete, the information contained
therein.

Set forth below in this letter are the Company's responses to the
Comments raised in the Comment Letter. For the convenience of the Staff, the
Company has restated in this letter each of the Comments in the Comment Letter
and numbered each of the responses to correspond with the numbers of the
Comments in the Comment Letter. Capitalized terms used and not defined have the
meanings given in the Registration Statement. All references to page numbers and
captions correspond to the page numbers and captions in the preliminary
prospectus included in the Registration Statement.

Fortress Investment Group LLC
December 21, 2006
Page 2 of 70

Form S-1
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General
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1. The filing does not appear in EDGAR for Fortress Investment Group LLC,
rather it appears under Fortress Investment Group Holdings LLC. Please
reconcile.

The Company respectfully informs the Staff that one of the
Company's subsidiaries is currently a filer under the name "Fortress
Investment Group LLC." Prior to the completion of this offering, the
Company intends to change the name of that subsidiary and the
registrant.

2. Please include all information that is not subject to Rule 430A in the
next amendment, including a bona fide estimate of the range of the
maximum offering price for the shares and the maximum number of shares
offered. This information must be included on the prospectus cover
page, as well as in the body of the prospectus. See instruction 1(A) to
Item 501(b)(3) of Regulation S-K. We will need adequate time to review
this information once it is provided.

The Company will include the information identified in a
subsequent amendment to the Registration Statement prior to circulating
a preliminary prospectus. The pre-effective amendment with the non-Rule
430A pricing-related information will be filed with the Commission to
give the Staff sufficient time to review such information, and the
Company notes that the Staff may have additional comments once such
pre-effective amendment is filed.

3. We note your disclosure on page 35 that you are not an investment
company for purposes of the Investment Company Act. Please explain why
you believe that none of the Fortress Operating Group units held by
your wholly-owned subsidiary, FIG Corp., is an "investment security" as
that term is used in the Investment Company Act of 1940.

As described in the prospectus, the Company will reorganize
its structure and operations in connection with the offering and the
Nomura transaction. Upon completion of the reorganization, the Company
intends to conduct its investment advisory and management business
through FIG Corp. FIG Corp. will be an intermediate holding company
that will conduct its operations through several subsidiary operating
entities (the "Operating Entities"). Each Operating Entity will be
organized as a limited partnership. FIG Corp. will own the sole general
partner interest in each Operating Entity. FIG Corp. also will own 100%
of the voting limited partner interests issued by each Operating
Entity. The voting limited partner interests will permit FIG Corp. to
appoint, remove and replace the general partner of each Operating
Entity and to exercise all other voting rights

Fortress Investment Group LLC
December 21, 2006
Page 3 of 70

with respect to each Operating Entity, except for certain negative
consent rights held by the principals. The principals will own 100% of
the non-voting limited partner interests issued by each Operating
Entity. The non-voting limited partner interests give the principals no
voting rights, except that the principals will be entitled to consent
to any amendment to the partnership agreement governing an Operating
Entity if the amendment would adversely affect the limited partner
interests owned by the principals.

As a result of the reorganization, each Operating Entity will
be a majority-owned subsidiary of FIG Corp. within the meaning of the
Investment Company Act of 1940, as amended (the "Investment Company
Act").(1) Section 2(a)(42) of the Investment Company Act defines
"voting security" as a security presently entitling its owner to vote
for the election of directors of a company. Section 2(a)(12) of the
Investment Company Act defines "director" to mean any director of a
corporation or any person performing similar functions with respect to
any organization, whether incorporated or unincorporated. The Staff and
the Commission take the position that a general partner of a limited
partnership performs functions with respect to a partnership similar to
the functions a director performs for a corporation, and that the
general partner therefore is a director of the limited partnership for
purposes of the Investment Company Act.(2) Because FIG Corp. will own
100% of the voting securities issued by each Operating Entity, each
Operating Entity will be a majority-owned subsidiary of FIG Corp.

The term "investment security" is defined in Section 3(a)(2)
of the Investment Company Act. Excluded from the definition of
"investment security" are securities issued by majority-owned
subsidiaries that are not investment companies and are not exempt from
investment company status by Section 3(c)(1) or Section 3(c)(7) of the
Investment Company Act.

---------------------
(1) See Section 2(a)(24) of the Investment Company Act (defining
"majority-owned subsidiary" of a parent company as any subsidiary 50%
or more of the voting securities of which are owned by the parent
company).

(2) See, e.g., Investment Company General Partners Not Deemed Interested
Persons; Investment Company Limited Partners Not Deemed Affiliated
Persons, Release No. IC-19658 (Aug. 25, 1993), [1993 Transfer Binder]
Fed. Sec. L. Rep. (CCH) P. 85,213, at 84,294-84,295 (adopting Rules
2a3-1 and 2a19-2 under the Investment Company Act); Investment Company
General Partners Not Deemed Interested Persons; Investment Company
Limited Partners Not Deemed Affiliated Persons, Release No. IC-18,868
(Jul. 28, 1992), [1992 Transfer Binder] Fed. Sec. L. Rep. (CCH) P.
85,020, at 83,141-83,142 (proposing Rules 2a3-1 and 2a19-2 under the
Investment Company Act); Integrated Resources, Inc., SEC No-Action
Letter, (Jun. 1, 1979).

Fortress Investment Group LLC
December 21, 2006
Page 4 of 70

Upon completion of the reorganization, the primary assets of
each Operating Entity will be investment management contracts with, and
general partner and managing member interests in, the Fortress Funds,
because these assets currently comprise most of the assets of the
Operating Entities. The investment management contracts clearly are not
securities and the courts and the Commission have concluded that
general partner interests and managing member interests are not
securities (and therefore not investment securities) where the holder
of such an interest has operational control over the issuer of the
interest.(3) As a result, when the reorganization is completed,
"investment securities" will be less than 40% of each Operating
Entity's total assets (excluding cash items and U.S. government
securities) on an unconsolidated basis. Because (i) each Operating
Entity is a majority-owned subsidiary of FIG Corp. and (ii) no
Operating Entity will be an investment company as defined in the
Investment Company Act nor required to rely on the exemption found in
Section 3(c)(1) or Section 3(c)(7) of the Investment Company Act, none
of general partner interests or the limited partner interests issued by
the Operating Entities and owned by FIG Corp. will be "investment
securities" as defined in the Investment Company Act.

4. All exhibits are subject to our review. Accordingly, please file or
submit all of your exhibits with your next amendment, or as soon as
possible. Please note that we may have comments on the legal opinion
and other exhibits once they are filed. Understand that we will need
adequate time to review these materials before accelerating
effectiveness.

The Company has filed certain additional exhibits to the
Registration Statement as part of Amendment No. 1. The Company will
file all of the remaining exhibits required to be filed, including the
opinion required by Item 601(b)(5) of Regulation S-K and the
underwriting agreement, prior to requesting acceleration of the
effectiveness of the Registration Statement and will give the Staff
sufficient time to review the exhibits once filed.

-------------------
(3) See, e.g., Williamson v. Tucker, 645 F.2d 404 (5th Cir.), cert. denied,
454 U.S. 897 (1981); Shoreline Fund L.P. and Condor Fund International,
Inc., SEC No-Action Letter (Nov. 14, 1994); Scudder, Stevens, & Clarke,
SEC No-Action Letter (Mar. 12, 1980); Oppenheimer Capital, L.P., SEC
No-Action Letter (July 29, 1987); Albert M. Zlotnick, SEC No-Action
Letter (June 9, 1986). The same conclusion has been reached with
respect to managing member interests of limited liability companies.
See Keith v. Black Diamond Advisors, Inc., 48 F. Supp. 2d 326, 332
(S.D.N.Y. 1999); Great Lakes Chemical Corp. v. Monsanto, 96 F. Supp. 2d
376 (D. Del. 2000); Robinson v. Glynn, 349 F.3D 166 (4th Cir. 2003);
Nelson v. Stahl, 173 F. Supp. 2d 153 (S.D.N.Y. 2001).

Fortress Investment Group LLC
December 21, 2006
Page 5 of 70

5. Prior to the effectiveness of the registration statement, please
arrange to have the NASD call us or provide us with a letter indicating
that the NASD has cleared the filing.

The underwriters have made a filing with the Corporate
Financing Department of the NASD and will request that the NASD call
the examiner when the NASD issues its "no-objections" letter.

6. Please do not use smaller type in tables and footnotes, as you do on
pages 5, 15, 16, 19, 44, 59, 69, 72, 73, 93, 98 and 112, for example.

The tables and footnotes throughout the Registration Statement
have been revised in response to the Staff's comment.

7. Please update all information in the prospectus to the most recent
practicable date and where we ask for revisions to your disclosure in
one place in the registration statement, please make similar revisions
in all other applicable places.

The disclosures throughout the Registration Statement have
been revised in response to the Staff's comment.

Inside Front Cover Page
-----------------------

8. Please provide a copy of any inside cover graphics.

Copies of all graphics to be contained in the prospectus will
be submitted supplementally to the Staff as soon as practicable and
prior to circulating preliminary prospectuses. The Company notes that
the Staff may have comments that could result in material revisions to
the Company's graphics.

Glossary, page i
----------------

9. Please briefly explain what comprises incentive income and reverse
earnings.

In response to the Staff's comment, the Company has revised
the description of distributable earnings throughout the Registration
Statement to provide further clarity.

Prospectus Summary, page 1
--------------------------

10. Currently, your summary is written from the perspective of someone who
is already quite familiar with the transaction and the entities
involved. Please revise your descriptions of your structure and the
transactions in clear, plain

Fortress Investment Group LLC
December 21, 2006
Page 6 of 70

English. In addition, in the discussion of your organization structure
on the top of page 6 and under Shareholders Agreement, please provide
the disclosure in bullet format instead of embedded lists of
information.

The disclosure on pages 7-11 and 57-61 has been revised in
response to the Staff's comment. In particular, the Company
respectfully draws the Staff's attention to the revisions to the
Section "Structure and Formation of our Company."

11. Please provide the basis for the following statements or explain what
you mean by:

o Fortress is a leading global alternative asset manager. Is this
statement based upon the amount of assets under management or some
other metric?;

o We invest substantial capital in each of the investment funds we
manage;

o We... seek to generate superior risk-adjusted investment returns;

o being a thought leader in the alternative asset management
industry; and

o In addition, we believe that we are well positioned to explore a
number of traditional asset management strategies, such as
long-only equity funds.

The disclosure on pages 1, 99 and 142 has been revised in
response to the Staff's comment. The Company respectfully informs the
Staff that the statement regarding its being a "Leading" alternative
asset manager is based on a variety of facts, including the amount of
its assets under management, the diversity of its alternative products
and the performance of its investment funds. In addition, the Company
is supplementally providing the Staff materials, included in Annex A
attached hereto, which it believes provide a reasonable basis for the
Company's use of the adjective. In addition, the Company respectfully
informs the Staff that its statement that it seeks to generate superior
returns means that it seeks to generate positive returns through
changing economic cycles, consistent with the absolute return
objectives of an alternative asset manager.

12. Please provide prominent disclosure regarding the total compensation or
other remuneration that each principal will receive from:

o cash distributions in 2006,

o distributions in 2007 relating to receivables from your offshore
hedge funds,

o cash distributions to be made immediately prior to the offering,

o any proceeds of this offering,

o in connection with the offering, and

o other reorganization transactions, including any carried interest.

Please also disclose how future distributions will be calculated and
made to the principals.

Fortress Investment Group LLC
December 21, 2006
Page 7 of 70

Additional disclosure has been added on pages 4 and 5 in
response to the Staff's comment. The principals will not be receiving
any proceeds of the offering and there will be no distribution to the
principals prior to completion of the offering other than the
distributions indicated in these revisions as expected to occur prior
to completion of the offering, which includes distributions relating to
the collection of receivables from offshore hedge funds for fees earned
in prior periods (i.e., periods ending December 31, 2006). The Company
respectfully informs the Staff that it expects to be able to include in
its next pre-effective filing the total amounts distributed to the
principals in 2006, as well as the amounts distributed or to be
distributed to the principals in 2007 representing the balance of the
receivables from offshore hedge funds. In addition, we note that as
indicated in footnote b(i) on page 87, the net proceeds of the
collection of such receivables as of September 30, 2006, assuming all
such amounts were collected on September 30, 2006, total approximately
$435 million, of which a portion is being distributed in late 2006 and
the remainder in early 2007. The amount of such collections that will
be disclosed as distributed to the principals in 2007, therefore,
equals such $435 million, less the portion thereof distributed in 2006,
plus the increase in the amount of such receivables through the date of
distribution (representing primarily increases in the amount of such
receivables attributable to fourth quarter 2006 offshore hedge fund
fees).

In addition, the Company respectfully informs the Staff that
(i) the principals do not hold (and have not held) in any personal
capacity any portion of the carried interest in any fund managed by
Fortress and (ii) the Fortress Operating Group will not be distributing
or otherwise transferring prior to completion of the offering to the
principals any such carried interest (or similar rights). A central
premise of the principals' decision to enable public investors to
participate in Fortress's business - by creating a public company that
would, through the intermediate holding companies, become a partner in
the Fortress Operating Group - is that the entirety of their business
interests should be owned by the investment management business in
which the public is, indirectly, investing. Accordingly, for a variety
of reasons, including the desire to avoid what are perceived to be
otherwise unavoidable real or apparent conflicts of interest, the
principals determined that the Fortress Operating Group would continue
to hold the entirety of the carried interests of each Fortress-managed
fund owned by the principals, including all already fully invested
vintage private equity funds.

13. Please clarify whether distributable earnings will be distributed to
class A shareholders as dividends on a pro rata basis with the other
unit holders. If not, explain how distributable earnings will be
allocated to the class A shareholders versus the other unit holders.

The disclosure on pages 10, 21, 63 and 71 has been revised in
response to the Staff's comment.

Fortress Investment Group LLC
December 21, 2006
Page 8 of 70

14. Please clarify whether all of the management fees, incentive income and
investment income earned by the principals will flow to the class A
shareholders in the same manner as to the principals through their
proportionate beneficial ownership of the units in the operating group.
Explain how unit income is distributed to the principals and whether
the unit income the principals receive is subject to different
allocations, such as pursuant to the tax receivable agreement. Clarify
whether all the operating group units are the same or whether some,
such as the units distributed to the principals, have different
features or rights associated with them.

The disclosure on pages 7-11, 57-61 and 71 has been revised in
response to the Staff's comment.

15. We note that Fortress Investment Group recently acquired RailAmerica
for $1.1 billion, including $400 million in debt. Fortress also
recently acquired Champions mortgage origination platform. Please
include a recent developments section in the Summary and describe all
recent material developments in your business. Please discuss the
affect of these material developments on your financial statements and
liquidity in MD&A.

The Company respectfully informs the Staff that the
RailAmerica and Champion businesses are in the process of being
acquired, respectively, by one of Fortress's private equity funds,
Fortress Investment Fund IV ("Fund IV") and by an existing portfolio
company of certain of Fortress's private equity funds. The Company
respectfully refers the Staff to the Company's responses to comments
123 and 124.

Our Company, page 1
-------------------

16. In the first paragraph, disclose that you are a holding company and
that the operations of the Fortress business will be performed and all
your assets will be held through the Fortress Operating Group. Also
disclose in this paragraph that 10% of the principal assets will be
held by the class A shareholders, but 90% of the assets and voting and
operating control of the business will be held by the principals.
Explain that the units directly held by the principals may also be
exchanged for class A shares. Please provide this disclosure in bullet
point format.

The disclosure on page 1 has been revised in response to the
Staff's comment.

17. We note your disclosure that your fundamental philosophy is premised on
alignment of interests with investors in your funds, that the offering
is a unique opportunity to become aligned with your principals, and
that your strategy is to

Fortress Investment Group LLC
December 21, 2006
Page 9 of 70

align your economic interests with those of your investors. However,
your interests appear different given that you earn management fees
regardless how well the funds perform. Other examples of potential
differing interests are disclosed by you in the Risk Factors section,
such as conflicts of interests with investors (page 25) and different
tax positions (page 34). Please revise accordingly.

The Company respectfully informs the Staff that the Company
earns a significant portion of its distributable earnings through
incentive income, which is paid only if investors make money. In
addition, the Company and the principals have invested significant
capital in the Fortress Funds, reflecting the purest alignment with
fund investors, again making money only if investors make money and
putting capital at risk. Finally, although the Company also earns
significant management fees, we believe that future management fees are
at risk over the long term unless the applicable fund performs well
over time. See, generally, "Risks Related to Our Funds." As an
alternative asset manager, the Company believes that it is well-aligned
with its fund investors.

The Company seeks to establish similar significant alignment
with its shareholders. Accordingly, its senior management, the
principals, have substantial capital at risk - their investment in the
Company, and, notably, are taking significantly below market salaries,
relying on returns on this investment as their compensation. Although
we have highlighted, as the Staff has noted, certain differing
interests, the Company believes that the principals' investment and
compensation arrangement provides a compelling alignment of interests
with the Class A shareholders.

18. We note that you have net asset value of principal investments in and
unfunded capital commitments to the Fortress Funds of $500 million as
of June 30, 2006, as disclosed on page 1. We also note your disclosure
on page 80 of your total commitment and remaining commitment of $211.9
million and $173.6 million, respectively, as of June 30, 2006. Please
reconcile these disclosures. Tell us at what point you recognize these
unfunded commitments as liabilities in your combined balance sheets.
Also, tell us how you determined that your unfunded commitments do not
qualify as derivatives under SFAS 133. Finally, please include a table
in your liquidity section of MD&A that details your total capital
commitments for all of Fortress Funds and Castle by year in which such
commitment expires or is required to be completed.

The disclosure on pages 2, 99, 105 and 142 has been revised
to correct and reconcile the Company's disclosure in response to the
Staff's comment.

The Company does not recognize in its financial statements the
unfunded commitments it has to its consolidated funds. The Company, as
the funds' general partner, controls these subsidiaries and has the
unilateral right to call capital; the

Fortress Investment Group LLC
December 21, 2006
Page 10 of 70

Company, in other words, controls when parties which have made
commitments to the funds, including both third party investors and the
Company itself, must fund their commitments and make additional capital
contributions. Regarding the recognition of unfunded capital
commitments as liabilities, we do not believe that there is a specific
GAAP requirement for recognizing unfunded commitments except as found
in EITF 94-1, "Accounting for Tax Benefits Resulting from Investments
in Affordable Housing Projects," which states that delayed equity
contributions should be recorded as a liability if unconditional and
legally binding, or in accordance with SFAS 5, "Accounting for
Contingencies," if such contributions are contingent upon a future
event and the occurrence of such event is deemed probable. In addition,
the Company will maintain the ability to decide whether additional
capital will be called following deconsolidation of these funds, and
for the reasons noted above, the Company believes that it should not
account for the unfunded capital commitments as liabilities.

The Company does not believe that its unfunded capital
commitments meet the definition of a derivative as noted in paragraphs
6-11 of SFAS 133. Pursuant to paragraph 6(c), (1) there is no explicit
net settlement provision in this arrangement, (2) the arrangement
cannot readily be settled net by a means outside the contract, and (3)
it does not provide for delivery of an asset that puts the recipient in
a position not substantially different from net settlement. When
formulating its conclusions, the Company considered that actually
funding the capital contribution does not put the Company in a position
similar to net settlement (i.e. the equity investments in each fund are
not readily convertible to cash because there is no active, liquid
market for the general partnership interests). Additionally, the funds
(i.e., our private equity and managed investment funds) typically hold
investments that are generally illiquid.

The Company respectfully informs the Staff that the Castles
are permanently capitalized vehicles that raise capital by issuing
common stock, and that the capital structure of our hedge funds are
such that investments are made at a point in time, not pursuant to
capital commitments that can be drawn over time; accordingly, we do not
have any capital commitments to any of our hedge funds or Castles. The
Company respectfully informs the Staff that the remaining capital
commitments for Fortress Funds and the period over which these
commitments are expected to be substantially called (three years) are
as disclosed in page 133, footnote 4.

19. Where you discuss pre-tax distributable earnings, please also discuss
net income for those same periods. Also disclose whether your AUM and
distributable earnings definitions are based on definitions in your
operating, management or other agreements.

The disclosure on pages i, 2 and 142 has been revised in
response to the Staff's comment.

Fortress Investment Group LLC
December 21, 2006
Page 11 of 70

20. Disclose the basis for all of your assertions about your competitive
position within your industry. We note, for example, your disclosure
that you are "a best-of-class global alternative asset management
enterprise" and that you funds are "consistently among the highest
performing funds." If you do not have appropriate independent support
for a statement, please revise the language to make clear that this is
your belief based on your experience in the industry, if true. This
comment is also applicable to any unsupported claims in the Business
section of the filing

The disclosures on pages 2, 3, 142 and 144 have been revised
in response to the Staff's comment to indicate that these are
statements of belief.

21. In the second bullet point under Competitive Strengths, please explain
in greater detail your net asset value of investments in, and the
amount of unfunded commitments to, your funds in the amount of $500
million. Briefly explain here and describe in greater detail in MD&A
how you fund these investments. For example, explain whether you use
carried interest or debt for these investments.

The disclosure on pages 3, 125 and 142 has been revised to
correct and reconcile the Company's disclosure in response to the
Staff's comment.

22. Considering the significant impact the deconsolidation of the
consolidated Fortress Funds will have on your financial statements, as
demonstrated by the pro forma financial statements, please include a
sufficiently detailed discussion of your intent to deconsolidate these
funds in this section of your Form S-1. Such discussion should include:

o The business purpose for your decision to grant investors in each
fund the right to accelerate the date on which the fund is
liquidated, without cause, in accordance with certain procedures.

o Whether these investors purchased this new right. If not, why not.

o The impact this change will have on your financial statements,
including footnote disclosure.

In addition, when disclosing the transactions that will be completed in
connection with your IPO, please list the deconsolidation of the
Fortress Funds currently consolidated in Fortress Operating Group's
financial statements as the first item instead of the last considering
its significance. Finally, please include a risk factor that discusses
the impact on your financial statements and footnote disclosures once
these funds have been deconsolidated.

The disclosure on pages 63, 77 and 78 has been revised to
provide details on the effects the deconsolidation will have on our
financial statements. The disclosure on pages 5 and 13 has been revised
to discuss the business purpose of

Fortress Investment Group LLC
December 21, 2006
Page 12 of 70

this grant. We note that the investors in the funds to be
deconsolidated will not be required to pay for the grant of the rights
resulting in the deconsolidation; the grants are being affected by
agreements that have been made by the applicable fund general partner
entities to amend the fund documents to include such rights. Throughout
the document, we have revised the description of the Transactions to
list the deconsolidation first.

With respect to a risk factor discussing this issue, the
Company respectfully submits that:

o The risk factor currently included on page 42 fully describes
the true risks related to the deconsolidation, i.e., the loss
of control over the right to liquidate Fortress Funds;

o The effects of the deconsolidation on our financial
statements are fully described on pages 63, 77 and 78; and

o The financial statements, while losing some degree of details
regarding the underlying Fortress Funds, will provide clearer
and more meaningful information with respect to the Company's
business and performance following the effects of the
deconsolidation.

As such, the impact on the Company's financial statements and
footnote disclosures as a result of the deconsolidation does not, in
the Company's opinion, warrant a separate risk factor.

Structure and Formation of Our Company, page 5
----------------------------------------------

23. Please describe your structure in plain English from the viewpoint of
the class A shareholders. For example, where you discuss the operating
group, also simply state that the class A shareholders will only have
10% voting control and economic interest in the operating group and
that the five principals have the other 90% voting control and economic
interest.

The disclosure on pages 1, 7-11, 57-61 and elsewhere in the
Registration Statement has been revised in response to the Staff's
comment.

24. Since you are a holding company, please clarify your disclosure that
the class B shares have no economic interest in the company, since the
principals and employees who hold the class B shares hold economic
interests of the units through other entities. For example, disclose
that the class B shares will not receive dividends. Please explain
whether the class B shares can be transferred or sold and whether you
expect to list this class on an exchange in the future. Please explain
how the class B shares are associated with the units. We note your

Fortress Investment Group LLC
December 21, 2006
Page 13 of 70

disclosure that if a principal exchanges his unit, the corresponding
class B shares will be cancelled.

The disclosure on pages 1, 7 and throughout the Registration
Statement has been revised in response to the Staff's comment.

25. Please expand your chart to better illustrate your structure. For
example, the chart does not clearly identify that the principals will
directly own 90% of the units and that only 10% of the units will be
held by the intermediate holding companies.

The chart on pages 7 and 57 has been revised in response to
the Staff's comment.

26. Please explain in detail, for each level of the structure, the reasons
why you have formed your company this way and the purpose for each
entity. For example, why are there separate entities for Operating
Entities and Principal Holdings? Why are there separate entities for
the intermediate holding companies?
What is the function of each?

The disclosure on pages 8-11 and 58-61 regarding the structure
of the Company has been revised in response to the Staff's comment.

27. Please explain in greater detail the general partner interests and how
they control each Fortress Operating Group entity.

The Company respectfully informs the Staff that either FIG
Corp. or FIG Asset Co. LLC will be the sole general partner of each of
the entities that comprise the Fortress Operating Group and will
exclusively manage the business and affairs of each such entity and
control such Fortress Operating Group entity under EITF 04-05. The
disclosure on pages 7-11 and 58-61 has been revised in response to the
Staff's comment.

The Transactions, page 6
------------------------

28. Please describe the transactions in plain English and explain the
purpose for each transaction. List the transactions in the order of
their significance. For example:

o Why are you deconsolidating the Fortress funds and what effect
will that have on your financial statements.

o Why are you distributing cash to the principals?

o Which Fortress Fund are you liquidating?

Fortress Investment Group LLC
December 21, 2006
Page 14 of 70

o What is the purpose of the inter-company demand note and how does
this relate to the exchange for the sole general partner interest?

The disclosure on pages 11-14 and 61-63 has been revised in
response to the Staff's comment.

The Company respectfully informs the Staff with respect to the
final question above that there is no relationship between the
inter-company demand note and the exchange for the sole general partner
interest in each of the Fortress Operating Group entities. Accordingly,
the disclosure on pages 13 and 59 describing the "Transactions" has
been revised in response to the Staff's comment to clarify that
issuance of the general partner interest occurs as a function of the
admission of the applicable intermediate holding company to the
applicable Operating Entities and Principal Holding entities as general
partner. In addition, the Section "Structure and Formation of our
Company - Allocation of Proceeds of this Offering and the Intermediate
Holding Company Demand Note," has been revised to describe in greater
detail the function of the inter-company demand note.

29. Please explain why you might add additional intermediate holding
companies in the future.

The disclosure on page 14 has been revised in response to the
Staff's comment.

30. Please provide quantifications for the transactions you list in the
bullet points, such as the net proceeds to be distributed to your
principals relating to your offshore hedge funds and the amount to be
liquidated under one of the Fortress Funds.

The Company respectfully advises the Staff that the amounts
relating to distributions to the principals have not yet been
determined and therefore, will be disclosed in future filings.

The Company further advises the Staff that it is currently
managing the liquidation of Northcastle, one of the Fortress Funds,
which as of November 30, 2006 was substantially complete. The expected
distribution to investors of this fund will aggregate to $208.5
million, which the Company has disclosed in this filing in response to
the Staff's comment.

31. Regarding the third bullet on page 6 for the distribution to the
principals of the net proceeds received relating to the collection of a
portion of a receivable relating to previously earned fees, please
include disclosure that clarifies why your are distributing a portion
of a receivable for previously earned fees to your

Fortress Investment Group LLC
December 21, 2006
Page 15 of 70

principals in connection with the reorganization, rather than
distributing such amounts through the general distribution described in
the second bullet.

The disclosure on pages 5, 12 and 61 has been revised in
response to the Staff's comment. The Company has revised the disclosure
in the third bullet on pages 12 and 61 to focus on the collection of
the receivable and to note that the proceeds will be used to partially
fund the distribution to its principals described in the second bullet.
The amount to be collected and distributed will depend on the value of
the receivable at the dates of collection with a significant portion
expected to be collected in January 2007. The Company will add the
disclosure of the amount in a later pre-effective amendment. This
filing includes a pro forma adjustment related to this item (see
footnote b(i) to the Unaudited Pro Forma Financial Information)
assuming the amount to be collected based on the balance as of
September 30, 2006.

The Company respectfully advises the Staff that the disclosure
of the full amount to be distributed to the principals will be included
in the second bullet, regardless of the source of funding. The Company
further advises the Staff that it believes it is important to reflect
the collection of the receivable in the unaudited pro forma financial
information since the portion of the receivable funding the
distributions to the principals represents approximately 37% of the
Company's deconsolidated assets as of September 30, 2006. Further the
collection and distribution of proceeds presents a material change in
the composition of its assets that should be disclosed to investors.

32. Under Class A and Class B shares, you state that these classes will
vote together as a single class except as otherwise required by
applicable law. Please explain what you mean by "applicable law."

The Company has revised the Registration Statement to delete
this exception throughout the Registration Statement with respect to
the Class A shares and Class B shares voting together as a single
class.

33. Please describe in greater detail under a separate heading the Fortress
Operating Group units and the associated rights. Explain how the class
B shares are related to the units. Disclose how many employees hold
such units and the value of each unit. Disclose how many units will be
granted to certain employees in connection with the offering and
identify these employees and explain why they are receiving units in
connection with the offering.

The disclosure on pages 1, 8-9, 14-15, 58-59 and 65 has been
revised in response to the first portion of the Staff's comment. The
Company respectfully informs the Staff that as of the date of this
filing, the Company has not yet granted any Fortress Operating Group
units or other equity interests in Fortress to any

Fortress Investment Group LLC
December 21, 2006
Page 16 of 70

Fortress employees and, in fact, has not yet determined which employees
will receive grants of Fortress Operating Group units (or other
interests) or the amount of units to be granted or whether any units
will be granted to employees. The Company expects to make such
determination prior to the time effectiveness of the Registration
Statement and will disclose at such time the information requested. The
Company further expects that the grant of Fortress Operating Group
units to employees will occur at the time of or immediately prior to
the IPO and that the grant date fair value will be calculated based
upon the IPO price of the Class A shares. As noted in the Company's
response to Comment No. 84, the Company believes that the Fortress
Operating Group units (and their corresponding Class B shares)
economically correspond generally to the Class A shares and therefore
the IPO price for the Class A shares is an approximate proxy for the
fair value of the Fortress Operating Group units and Class B shares. In
addition, the Company respectfully informs the Staff that the Company
currently expects to grant restricted Fortress Operating Group units,
restricted Class A shares and/or restricted Class A share units that in
the aggregate will represent between 5% and 10% of the Company's
outstanding equity interests (on a fully converted basis).

Exchange of Fortress Operating Group Units, page 8
--------------------------------------------------

34. Please clarify the following:

o What is the exchange rate between the units and the class A
shares?

o When you refer to "our option" to convert the principals' units
into cash, it appears that it is really at the principals' option.
Please revise or explain.

o Briefly describe the material terms of the tax receivable
agreement to put your disclosure in context or move the Tax
Receivable Agreement section in front of the Exchange section.

o How do FIG Corp. or FIG Asset Co. LLC realize tax savings on
behalf of affiliated corporations, i.e., how does the exchange
relate to a tax benefit? Please discuss that this results from an
increase in the tax basis of the assets of the Fortress Operating
Group.

o Explain how the principals' units are associated with the class B
shares.

o How will your interest in the units be increased upon an exchange?
Does this mean that you might have more than a 10% economic
interest in Fortress Investment Group? Clarify the affect on the
existing class A shareholders. If the principals exchange their
units, does that cause dilution to the existing class A
shareholders?

The Company respectfully informs the Staff that it has revised
the disclosure on pages 14-15 and 65 has been revised in response to
the Staff's comment, as noted below:

Fortress Investment Group LLC
December 21, 2006
Page 17 of 70

o A Fortress Operating Group unit, and its corresponding Class B
share, may be exchanged for one Class A Share.

o Subsequent to the initial filing the Company has revised the terms
of the Exchange Agreement to remove the cash option such that
holders of Fortress Operating Group units will only be able to
exchange such units for Class A shares, and not for cash, pursuant
to the Exchange Agreement.

o The principals will be issued one Class B share for each Fortress
Operating Group unit they own. If a principal wants to exchange a
Fortress Operating Group unit for a Class A share, he will need to
deliver both the Fortress Operating Group unit and the
corresponding Class B share in the exchange in order to receive a
Class A share. When the exchange is completed, the Class B share
will be cancelled.

o The exchange of a Fortress Operating Group unit, and its
corresponding Class B share, by a principal for a Class A share
will not have any effect on the economic or voting rights of Class
A shareholders; a principal's interest in Fortress Operating Group
units will not be increased upon an exchange

In each exchange, the Company will issue a Class A share to,
but will also receive a Fortress Operating Group unit from, a
principal. The economic rights of each Class A shareholder in the
Company will be diluted after each exchange by the amount of Class A
shares newly issued in such exchange. However, the Company will receive
Fortress Operating Group units in such exchange, so it will be entitled
to receive a greater portion of all distributions made by the entities
that comprise the Fortress Operating Group. Accordingly, after each
exchange, current Class A shareholders will own a smaller economic
percentage of the Company, but the Company's economic ownership
percentage of (and right to receive distributions from) the Fortress
Operating Group, will be proportionately increased.

Because the principals must deliver one Class B share which
entitles the holder to one vote per share in connection with each
Fortress Operating Group unit they have exchanged for a Class A share,
which entitles the holder to one vote per share, exchanges will have no
effect on the total amount of votes that may be cast by all
shareholders of the Company or on the voting power of the third party
investors in the Company relative to the principals.

35. We note your disclosure that the principals and other employees that
own Fortress Operating Group units are exchangeable into one of your
Class A shares at their option. The corresponding Class B share is
cancelled at the time of conversion of the Fortress Operating Group
units into Class A shares. In addition, the principal or employee
receives a right to receive 85% of the value of the applicable tax
benefit in cash when the tax savings are realized. We did not

Fortress Investment Group LLC
December 21, 2006
Page 18 of 70

note a pro forma adjustment or a pro forma footnote disclosure as to
whether these rights constitute derivatives that are required to be
marked-to-market each reporting period. As such, please provide us with
your analysis of SFAS 133 and EITF 00-19 in determining whether these
rights meet the definition of derivative financial instruments. If you
determined that these rights are derivative instruments required to be
recognized on your balance sheet and marked-to-market each period,
please include the necessary adjustments to your pro forma financial
statements, including footnote disclosure that adequately explains the
adjustments and how you arrived at the amounts.

The Company determined that the right to exchange a Fortress
Operating Group unit into a Class A share ("the Exchange Option") does
not represent a derivative under the scope of SFAS 133 that should be
separated from its host and separately accounted for as a
mark-to-market liability. As described in the response to Comment 84,
70% of the Fortress Operating Group units are subject to forfeiture and
represent a share-based compensation arrangement under SFAS 123(R)
that, pursuant to paragraph 11(b) of SFAS 133, is excluded from the
scope of SFAS 133. With respect to the Exchange Option related to those
Fortress Operating Group units not subject to forfeiture, the Company
determined that the Exchange Option should not be accounted for as a
derivative liability under the scope of SFAS 133 since the economic
characteristics and risk of the Exchange Option and Class A shares are
clearly and closely related to the Fortress Operating Group units under
paragraph 12(a) of SFAS 133. The Fortress Operating Group units and the
Class A shares grant residual economic interests in the same underlying
assets, and therefore have substantially equivalent economic
characteristics (i.e., Fortress Operating Group units are in substance
the economic equivalent of Class A shares). As such, the Exchange
Option is not required to be bifurcated from the host Fortress
Operating Group units. In addition, the Company also believes that the
Exchange Option would be scoped out of SFAS 133 pursuant to paragraph
11(a) since the Exchange Option is (1) indexed to the Company's stock
and (2) classified in stockholders' equity.

With respect to our analysis under paragraph 11(a) of SFAS
133, we advise the Staff that subsequent to filing the Registration
Statement to which the Staff's comment relates, the Company removed the
potential cash settlement feature associated with the exchange of the
Fortress Operating Group units for Class A shares, thereby alleviating
the potential derivative classification under EITF 00-19.

With respect to the principal's right to receive a cash
payment for 85% of the value of any tax benefits, the Company assessed
the tax receivable agreement under SFAS 133 and EITF 00-19 and believes
that the agreement is outside the scope of SFAS 133 under paragraph
10(e)(2)(a) because the predominant underlying asset on which
settlement is based is a nonfinancial asset that is not readily
convertible to cash. That is, the value of the Company's future taxable

Fortress Investment Group LLC
December 21, 2006
Page 19 of 70

income and the tax basis of its assets drives the potential payment
under the tax receivable agreement and this tax basis of its assets is
predominantly comprised of goodwill, which is a nonfinancial asset.
Please refer to our responses to Comment 86 for additional details
regarding the accounting for the Tax Receivable Agreement.

Shareholders Agreement, page 8
------------------------------

36. Please clarify that you are referring to the combined voting power of
both the class A and class B shares.

The disclosure on page 16 and throughout the Registration
Statement has been revised in response to the Staff's comment.

37. Please explain the purpose of the Shareholder Agreement, given that the
principals currently have 90% of the voting power of Fortress
Investment Group through the class B shares and also have management
control through the only executive officer position. For example,
disclose whether the principals may in the future exchange their units
for class A shares and what that means to existing class A and class B
shareholders.

The disclosure on page 16-17 and 66-67 has been revised in
response to the Staff's comment.

38. Please disclose whether you will be considered a "controlled" company
under the New York Stock Exchange rules and what that means with
respect to your compliance with the corporate governance rules relating
to independent directors and board committees.

Although the Company may qualify as a "controlled company"
under the rules of the New York Stock Exchange (the "NYSE"), the
Company nonetheless intends to comply, upon completion of the offering,
with the corporate governance requirements of the NYSE which are
applicable to companies that do not qualify as a "controlled company."

39. Please describe the "clawback" obligation in greater detail to put the
related disclosure regarding the shareholders agreement in context.
Quantify the clawback obligation and clarify whether the company will
pay this obligation. Please revise this paragraph to describe this
arrangement in clear, plain language.

The disclosure on pages 17 and 67 has been revised in response
to the Staff's comment. The Company also refers the Staff to the
quantification of the

Fortress Investment Group LLC
December 21, 2006
Page 20 of 70

distributed amounts of deferred incentive income in footnote 3
disclosed on pages F-19 and F-61.

Tax Receivable Agreement, page 10
---------------------------------

40. Please clarify the following:

o Why are you entering into this agreement?

o Why will the corporate taxpayers receive tax savings upon the
occurrence of an exchange?

o Discuss each of the tax basis factors in a separate bullet point
and explain how they could vary.

o How will the tax receivable payments to the principals affect the
class A shareholders?

o Describe in greater detail what you mean by stating that the
payments to the principals could be material in amount. Can you
estimate these payments to provide investors with more
information?

The disclosure on pages 15-16 and 65-66 has been revised in response to
the Staff's comments.

With respect to the last bullet in the Staff's comment, we have noted
on page 15-16:

Our purchase, through our intermediate holding companies, of 15% of the
principal's Fortress Operating Group units as part of the Nomura
transaction will result in an increase in the tax basis of the assets
owned by the Fortress Operating Group at the date of the purchase of
approximately $927 million, which likely will result in us making
payments under the tax receivable agreement. Any payments under the tax
receivable agreement will give rise to additional tax benefits and
additional potential payments under the tax receivable agreement. Any
payments under the tax receivable agreement will depend upon whether
FIG Corp. has taxable income for U.S. federal income tax purposes to
utilize the benefit of the increase in the tax basis of the assets
owned by the Fortress Operating Group. For additional information
regarding the impact of the Nomura transaction on our pro forma balance
sheet as of September 30, 2006, see Footnote (d) of "Unaudited Pro
Forma Financial Information."

In addition, the Company respectfully informs the Staff that the Nomura
transaction results in an expected tax step up of $927 million in the tax basis
of the assets of the Company in respect of a transaction for 15% of the Company.
This step up gives rise to a deferred tax asset of $611 million and a
corresponding liability under the tax receivable agreement of $519 million,
which provides a clear indication of the potential magnitude of the potential
liability under the tax receivable agreement. At the time of

Fortress Investment Group LLC
December 21, 2006
Page 21 of 70

any future exchange by a principal, the Company intends to calculate the amount
of the increase in tax basis at that time and, to the extent we believe the
resulting benefit is more likely than not to be realized, we will record a
deferred tax asset and corresponding liability under the tax receivable
agreement.

Tax Consequences, page 10
-------------------------

41. You must clearly provide current disclosure regarding the tax
consequences of the transaction to investors. Please revise the words
that you "intend" to be treated as a partnership and that class A
shareholders "generally" will be required to report income for tax
purposes. Make similar changes in the Risk Factors section.

The disclosure on pages 18 and 69 has been revised in response
to the Staff's comments.

42. Please explain the following in the last paragraph:

o Why will you cause the cash amounts distributed equal at least the
maximum tax liability arising from the ownership of such unit?

o Why will no such distribution necessarily be required to be
distributed?

o Why might the cash dividends not be sufficient to cover the tax
liabilities?

o Clarify your disclosure, since some of these statements appear
contradictory.

The disclosure on pages 18 and 69 has been revised in response
to the Staff's comments.

43. Clarify whether you will receive a tax opinion. We note the statement
on page 38, but note that you have not listed an exhibit 8 in your
exhibit list. Please revise this disclosure to summarize counsel's
opinion and identify counsel. Please also comply with this comment
under Material U.S. Federal Tax Consequences.

The Company respectfully informs the Staff that, in accordance
with Item 601 of Regulation S-K, no tax matters opinion is required in
connection with the Registration Statement. Nonetheless, the Company
will receive an opinion of counsel, the content of which is discussed
in the sections of the Registration Statement entitled "Material Risks
Related to Taxation" and "Material U.S. Federal Tax Considerations."

The Offering, page 11
---------------------

44. Please move the "Fortress Operating Group units held" section on page
12 directly under the "Shares held after the offering" section on page
11 to clarify

Fortress Investment Group LLC
December 21, 2006
Page 22 of 70

that although the principals do not hold class A shares, they do own
90% of the economic interest in the units.

The disclosure on page 20 has been revised in response to the
Staff's comment.

45. Under, Majority Independent Directors, briefly explain how the
operating agreement modifies the authority and function of the board
and officers.

The Company's limited liability company agreement (the "LLC
Agreement") provides that: "Except as otherwise specifically provided
in this Agreement, the duties and obligations owed to the Company and
to the Members by the Officers and Directors shall be the same as the
respective duties and obligations owed to a corporation organized under
DGCL by its officers and directors, respectively."

No provision in the LLC Agreement expressly modifies these
duties. However, there are certain provisions regarding exculpation and
indemnification that are different than the corresponding provisions of
Delaware corporate law, as set forth below:

o The exculpation standard in the LLC Agreement for directors
and officers is different from the corresponding provision of
Delaware corporate law. The LLC Agreement provides that no
director or officer shall be liable to the Company except by
reason of acts or omissions constituting fraud, willful
misconduct or gross negligence. Section 102(b)(7) of Delaware
corporate law provides that a corporation can exculpate a
director from liability to the corporation except (i) for any
breach of the director's duty of loyalty to the corporation
or its stockholders; (ii) for acts or omissions not in good
faith or which involve intentional misconduct or a knowing
violation of law; (iii) under ss. 174 of the Delaware
corporate law (improper redemption of stock or declaration of
dividend); or (iv) for any transaction from which the
director derived an improper personal benefit.

o The indemnification standard in the LLC Agreement for
directors and officers is different from the corresponding
provision of Delaware corporate law. The LLC Agreement
provides that the Company may indemnify directors and officer
for acts or omissions, except by reason of acts or omissions
constituting fraud, willful misconduct or gross negligence.
Section 145 of the Delaware corporate law allows a
corporation to indemnify directors and officer for acts or
omissions, if the person acted in good faith and in a manner
the person reasonably believed to be in or not opposed to the
best interests of the corporation, and, with respect to any
criminal action or proceeding, had no reasonable cause to
believe the person's conduct was unlawful.

Fortress Investment Group LLC
December 21, 2006
Page 23 of 70

o The LLC Agreement provides that in the event a potential
conflict of interest exists or arises between any of the
principals, directors of the Company or their respective
affiliates, on the one hand, and the Company, any or its
subsidiaries or any of its shareholders, on the other hand, a
resolution or course of action by the board of directors of
the Company shall be deemed approved by all or the Company's
shareholders, and shall not constitute a breach of the
fiduciary duties of members of the board to the Company or
its shareholders, if such resolution or course of action is
(i) approved by the Company's conflicts committee, which is
composed of independent directors, (ii) approved by
shareholders holding a majority or the Company's Class A and
Class B shares, (iii) on terms no less favorable than those
generally available from unrelated third parties, or (iv)
fair and reasonable to the Company. Under the Delaware
corporate law, a corporation is not permitted to
automatically exempt board members from claims of breach of
fiduciary duty under such circumstances.

The Company has revised the disclosure on pages 20-21 and
189-190 in response to the Staff's comment.

46. Under Use of Proceeds in this section and on page 51, please describe
the principal purposes for which you intend to use the $500 million in
proceeds and the approximate amount intended for each such purpose. We
note your disclosure on page 2 that you are going public to meet
specified goals. Also disclose the amount and purpose for each
contribution you will make to the Fortress Operating Group. SASMF See
Item 504 of Regulation S-K.

The disclosure on pages 21 and 70 has been revised in response
to the Staff's comment.

47. Under Cash Dividend Policy, please revise to more accurately describe
your intent and the board of directors' intent with regard to the
dividend policy. Describe the risks and potential effect of this
policy.

The disclosure on pages 21 and 71 has been revised in response
to the Staff's comment.

48. Under Exchange Rights, disclose how many class A shares are reserved
for exchange and what affect this will have on beneficial ownership of
the existing class A shareholders.

The Company respectfully informs the Staff that the Company
has reserved for issuance a number of Class A shares equal to the
number of existing Fortress Operating Group units. The exchange will
have no effect on the

Fortress Investment Group LLC
December 21, 2006
Page 24 of 70

beneficial ownership in Fortress Operating Group of the existing Class
A shareholders.

49. For each bullet point under interests granted under your equity
incentive plan, please explain the reasons for each of these issuances
and the terms of the agreements, if any, which the shares are being
issued.

The disclosure on page 22-23 has been revised in partial
response to the Staff's comment. The Company respectfully informs the
Staff that because, as described in its response to Comment No. 75
below, it is currently in the process of determining the amount, type
(i.e., interests in the Company and/or in Fortress Operating Group) and
terms (e.g., vesting conditions, etc.) of the grants that it expects to
make, it is not able to respond definitively at present to the Staff's
request; however, such disclosure will be included in a pre-effective
filing.

50. Please explain why you would issue class B shares under the equity
incentive plan if they have no economic interest.

The Company respectfully informs the Staff that a holder
cannot exchange a Fortress Operating Group unit for a Class A share
without also delivering a Class B share for cancellation. Accordingly,
the Company will cause one Class B share to be issued in connection
with each Fortress Operating Group unit issued pursuant to the equity
incentive plan, so that employees will be in a position to exchange
their Fortress Operating Group units for Class A shares.

51. In the last paragraph of this section, please quantify the effect of
the over-allotment option on the interests on the Fortress Operating
Group.

The disclosure on page 23 has been revised in response to the
Staff's comment.

Summary of Historical Combined Financial Information, page 15
-------------------------------------------------------------

52. We note that you are presenting the measure, distributable earnings, as
a measure of operating performance. Please tell us and revise your
disclosure to clarify for what this measure tells an investor about
your operating results. In doing so, you may be required to provide a
more easily understood discussion of the adjustments you have made to
net income to arrive at your non-GAAP measure, distributable income.
Tell us if you consider this measure to be a non-GAAP measure and why.
If you believe this to be a non-GAAP measure, also tell us how you
determined that this measure complies with Item 10(e) of Regulation
S-K. Specifically, we note that you are removing and adding items that
are

Fortress Investment Group LLC
December 21, 2006
Page 25 of 70

recurring. If you determine that the presentation of distributable
earnings does not violate Item 10(e) of Regulation S-K, please revise
your disclosure to state:

o The economic substance behind your decision to use this measure;

o The material limitations associated with distributable earnings
when compared to net income; and

o The manner in which you compensate for these limitations when
using distributable earnings.

Refer to Question 8 of the SEC "Frequently Asked Questions Regarding
the Use of Non-GAAP Financial Measures" for additional guidance.

The Company has revised the description of distributable
earnings on page i, the sections entitled "Summary Historical Financial
Information," "Selected Financial and Operating Data," "Management's
Discussion and Analysis" and the footnotes to the combined financial
statements to clarify what the measure tells an investor about the
Company's operating results and to help the reader more easily
understand the adjustments made to net income to arrive at total
distributable earnings. The revised description describes the
limitations associated with using total distributable earnings and how
management compensates for those limitations.

Distributable earnings is the measure used by management for
the purposes of assessing segment performance and to make decisions on
the allocation of resources to those segments. The CODM analyzes
distributable earnings in order to determine whether to expand or
cancel operations of an individual segment, identify and allocate
employees with appropriate expertise, and allocate the principal
investments of the Company among segments. We are providing copies of
the reports used by our CODM in response to Comment No. 140. SFAS 131
requires the footnotes to the Company's financial statements to include
the measure of profit and loss used by management in assessing segment
performance. The Company understands that presentation of the segment
performance measure, distributable earnings, would be permitted
pursuant to Question 18 of the Staff's "Frequently Asked Questions
Regarding the Use of Non-GAAP Financial Measures" (the "Q&A"). Further,
the Company has discussed segment performance as required in the
Management's Discussion and Analysis in order for an investor to gain
an understanding of Fortress Operating Group's business, relying upon
the Staff's guidance in Question 19 of the Staff's "Q&A."

The Company understands that the presentation of total
distributable earnings is a non-GAAP financial measure, pursuant to
Question 21 of the Staff's "Q&A," and that the presentation must comply
with the requirements of Item 10(e) of Regulation S-K and Question 8 of
the Staff's "Q&A" in order to present total distributable earnings. The
Company believes that the adjustments made to

Fortress Investment Group LLC
December 21, 2006
Page 26 of 70

net income to arrive at distributable earnings, other than the
adjustment for expenses which do not require an outlay of assets, do
not constitute adjustments to add or remove recurring items, but are
instead adjustments to reflect certain timing or temporary differences.

The Company believes that total distributable earnings
provides useful information to investors in order to understand the
manner in which the Company evaluates its business. In addition to
distributable earnings being the measure used by the Company to
determine segment performance, total distributable earnings is used by
the Company in determining the timing and amounts of distributions made
to Fortress Operating Group's unitholders. The Company recognizes the
material limitations associated with the use of total distributable
earnings as compared to the use of net income due to adjustments for
certain temporary or permanent differences. The Company has included
discussion of significant adjustments made in determining total
distributable earnings, material limitations associated with using
total distributable earnings in relation to net income, and the manner
in which management compensates for these limitations within its
revised disclosure. In order to comply with item 10(e) of Regulation
S-K, the Company has either presented the most directly comparable
financial measure in accordance with GAAP, net income, or a
reconciliation of total distributable earnings to net income, in each
section which presents total distributable earnings as well as a
discussion of the reasons that presentation of total distributable
earnings provides useful information to investors regarding the
Company's financial condition and results of operations.

Risk Factors, page 20
---------------------

53. Please delete the last sentence of the first paragraph on page 20. All
material risks should be described. If risks are not deemed material,
you should not reference them.

The disclosure on page 31 has been revised in response to the
Staff's comment.

54. Many of the risk factors do not comply with the plain English rules and
are also difficult to understand due to the complex nature of the
transactions or regulations you describe. For example, the risks
relating to your management and fund partnership agreements, your
organization and structure, and taxation should be revised so that
investors can understand more clearly the risks you discuss. Please
revise according to Rule 421(d) of Regulation C. We may have further
comments after reviewing your responses.

The disclosure throughout the "Risk Factors" section has been
revised in response to the Staff's comment.

Fortress Investment Group LLC
December 21, 2006
Page 27 of 70

55. Please provide the information investors need to assess the magnitude
of the risk. For example:

o Quantify the potential redemption and the debt acceleration
provisions relating to the key man provisions risk factor.

o Explain how your internal controls do not meet the requirements of
Section 404 of the Sarbanes-Oxley Act.

o Briefly describe the restrictions under law or regulation that
would prevent you from paying dividends.

o Quantify the payments to be made to the principals under the tax
receivable agreement.

Note that this is not meant to represent an all-inclusive list of where
your risk factors should be improved. We encourage you to provide
quantification of amounts and further clarification throughout your
discussion.

The disclosure throughout the "Risk Factors" section has been
revised in response to the Staff's comment. The Company also refers the
Staff to its response to Comment No. 40.

56. Please add a risk factor addressing your disclosure in the financial
statements that cash held at the consolidated subsidiaries is not
available to fund the general liquidity needs of the registrant and
explain why

The disclosure on page 47 has been revised in response to the
Staff's comment to add an additional risk factor. The Company further
refers the Staff to its response to Comment No. 126.

Risks Related to Our Business, page 20
--------------------------------------

Several of our funds have "key man" provisions ...., page 20
------------------------------------------------------------

57. We note that certain of the Fortress Funds you manage contain "key man"
provisions. Please include disclosure of the terms of these "key man"
provisions, including the financial statement impact such terms could
have.

The disclosure on pages 31-32 has been revised in response to
the Staff's comment.

The historical and unaudited pro forma financial information ...., page 22
--------------------------------------------------------------------------

58. You indicate in item (iii) that the unaudited pro forma financial
information does not reflect certain other historical transactions.
Please clarify what you mean by this and tell us the appropriateness of
excluding such transactions.

Fortress Investment Group LLC
December 21, 2006
Page 28 of 70

This disclosure has been removed in response to the Staff's
comment in order to avoid confusion as there were no historical
transactions excluded from pro forma information other than those
specified in the pro forma adjustments.

We are subject to third-party litigation risk ..., page 23
----------------------------------------------------------

59. Please describe in greater detail the legal recourse that investors
have against the general partners or investment managers for
dissatisfaction with the performance of funds.

The disclosure on page 35 has been revised in response to the
Staff's comment.

Risks Related to Our Funds, page 28
-----------------------------------

The historical returns attributable to our funds may not be indicative ....,
----------------------------------------------------------------------------
page 28
-------

60. Please explain why "the potential future returns of the funds we manage
do not, however, bear any relationship to the potential returns on our
Class A shares" and reconcile it with the risk factor on the following
page relating to poor performance of your funds causing a decline in
your revenue and distributable earnings.

The disclosure on pages 40-41 has been revised in response to
the Staff's comment.

Risks Related to Our Organization and Structure, page 33
--------------------------------------------------------

We intend to pay regular dividends ...., page 34
------------------------------------------------

61. Please disclose here and in the Dividend Policy section:

o whether you are required to pay dividends and whether the
shareholders will be guaranteed or have contractual rights to
receive dividends,

o whether your board of directors has the discretion to decrease or
discontinue the payment of dividends,

o the restrictions imposed by your amended and restated operating
agreement, and

o the affect on the market price of the class A shares if you did
not pay dividends.

The disclosure on pages 46-47 and 71 has been revised in
response to the Staff's comment. The Company respectfully informs the
Staff that it is unable to predict the effect on the market price of
the Class A shares if it determines not

Fortress Investment Group LLC
December 21, 2006
Page 29 of 70

to pay dividends although we have indicated under "Risk Factors" in the
Registration Statement that variations in our dividends could
negatively affect the price of our Class A shares. As described in the
Registration Statement, the Company's ability to pay dividends depends
on its receiving distributions from the Fortress Operating Group. We
note that the Company's Board of Directors may determine to not cause
Fortress Operating Group to make distributions in excess of required
tax distributions out of cash available for distribution for a variety
of business reasons. We believe, however, that the Company's
expectation that Fortress Operating Group will distribute a large
portion of its distributable earnings is clearly stated.

If we were deemed an investment company ..., page 35
----------------------------------------------------

62. Please revise the first sentence to state that based upon the reasons
set forth you do not believe you are an investment company.

The disclosure on page 48 has been revised in response to the
Staff's comment.

Risks Related to Taxation, page 38
----------------------------------

63. You must clearly provide current disclosure regarding the tax
consequences of the transaction to investors. Please revise the
language in the tax risk factors that you "intend" to be treated as a
partnership for tax purposes or that you "anticipate" that FIG Asset
Co. LLC will not be subject to direct corporate income tax.

The disclosure throughout the subsection of the Risk Factors
entitled "Risks Related to Taxation" has been revised in response to
the Staff's comment.

64. Please revise the language in the risk factors that you expect to
receive an opinion from counsel. A signed opinion must be filed before
the registration statement is declared effective. Also make similar
changes on the last paragraph on page 152 and delete the words "if
issued."

Please see the Company's response to Comment No. 43.

65. Please add a separate risk factor addressing the risk that the
principals may have different tax positions from the class A
shareholders that could influence the principals' decisions and that
these decisions may conflict with the interests of the class A
shareholders.

The disclosure on page 47 has been revised in response to the
Staff's comment to add an additional risk factor.

Fortress Investment Group LLC
December 21, 2006
Page 30 of 70

Market and Industry Data and Forecasts, page 43
-----------------------------------------------

66. Please delete the language in this section to eliminate the implication
that you are not responsible for the accuracy of the information you
elect to include in your prospectus, such as there is no guarantee
about accuracy and completeness and that you have not independently
verified information.

The disclosure on page 56 has been revised in response to the
Staff's comment.

Our Structure, page 47
----------------------

67. Please clarify your disclosure in the second paragraph on page 47 and
explain the reasons why the investments, contributions and transfers of
funds are being made in the manner disclosed. In addition, please add
the disclosure relating to the transfers of the use of proceeds to the
Use of Proceeds section.

The disclosure on pages 7-11 and 57-61 has been revised in
response to the Staff's comment.

Cash Dividend Policy, page 52
-----------------------------

68. The first sentence of this section should clearly state the dividend
policy, including the judgments made with regard to paying out cash
instead of retaining it. Also clarify whether the board contemplates
paying out all excess cash. If not, clarify what the rate is based on.
Fully address the potential long-term implications for your business
and financial condition arising from paying out cash. We may have
additional comments after we review your response.

The disclosure on page 71 has been revised in response to the
Staff's comment.

69. Disclose the frequency and amount of any cash distributions for the
past two years. See Item 201(c) of Regulation S-K. We note that the
company made a $250 million distribution to the principals in June
2006. Please disclose whether this distribution was declared pursuant
to any agreement. Clarify whether you have historically had used
earnings or borrowings to make these distributions.

The disclosure on page 72 has been revised in response to the
Staff's comment. The Company respectfully informs the Staff that the
$250 million distribution to the principals in June 2006 was made
pursuant to a determination of the Company's management committee and
not pursuant to any agreement.

Fortress Investment Group LLC
December 21, 2006
Page 31 of 70

70. Please describe in detail the restrictions and the definition of
default in your debt agreements and their potential impact on your
ability to pay dividends at the rates identified.

The Company respectfully informs the Staff that, under its
credit agreement, the Company is permitted to make cash distributions
subject to the following restrictions: (a) no event of default exists
immediately prior to or subsequent to the distribution, (b) the amount
of distributions over the prior 12 months do not exceed free cash flow
(as defined in the credit agreement) for the prior 12-month period, and
(c) after giving effect to the distribution, the Company has
cash-on-hand of not less than accrued but unpaid taxes and amortization
obligations under the credit agreement which are required in the next
90 days. The events of default under the credit agreement are typical
of such agreements and include payment defaults, failure to comply with
credit agreement covenants, cross-defaults to material indebtedness,
bankruptcy and insolvency, change of control, and adverse events with
respect to our material funds.

The disclosure on page 72 has been revised in response to the
Staff's comment.

71. Please discuss the applicable laws and regulations and the provisions
in your amended and restated operating agreement which may restrict you
from making distributions. We note your disclosure in the Risk Factors
section referring to these restrictions.

The Company respectfully informs the Staff that Section 18-607
of the Delaware Limited Liability Company Act prohibits a limited
liability company from making a distribution to a member to the extent
that the liabilities of the company, after such distribution, exceed
the fair value of the assets of the company.

The LLC Agreement does not contain any restrictions on our
ability to make distributions, except that the Company may only
distribute Class A shares to holders of Class A shares.

The disclosure on pages 71-72 has been revised in response to
the Staff's comment.

72. Clearly address the potential necessity of using borrowings to fund
dividends, if applicable. Discuss these assumptions and considerations
in MD&A as well, to the extent that they represent known material
trends, demands, commitments and uncertainties, or are otherwise
material to an understanding of your business, results of operations
and financial condition.

The disclosure on pages 72 and 104 has been revised in
response to the Staff's comment.

Fortress Investment Group LLC
December 21, 2006
Page 32 of 70

73. Please explain the tax distributions more clearly and in greater
detail.

The disclosure on page 71 has been revised in response to the
Staff's comment.

Dilution, page 55
-----------------

74. Revise the dilution table to include the shares underlying interests
that officers, directors, principals, employees, consultants and
affiliates have the right to acquire, including interests to be granted
under your equity incentive plan. See Item 506 of Regulation S-K.

The Company respectfully informs the Staff that it is
currently in the process of determining the amount of interests that
will be granted under its equity incentive plan - which may take the
form of interests in the Company and/or in Fortress Operating Group -
to directors, employees, consultants and affiliates. It is not
anticipated that interests will be granted to any principal under the
Company's equity incentive plan. Appropriate disclosure that complies
with Item 506 of Regulation S-K will be included in a pre-effective
filing following the Company's final determinations regarding the award
of interests under its incentive plan.

Unaudited Pro Forma Financial Information, page 57
--------------------------------------------------

75. We note that you have not completed the pro forma financial information
for the reorganization and the offering. Once you include such
information, we may have additional comments.

The Company will complete the pro forma financial information
for the reorganization and the offering in a subsequent pre-effective
amendment to the Registration Statement prior to circulating a
preliminary prospectus. The Company notes that the Staff may have
additional comments upon receipt of additional pro forma financial
information.

76. In the introduction to your pro forma financial statements, please
include a comprehensive discussion that explains the changes to your
historical financial statements and the footnote disclosures that will
result from the deconsolidation of the Fortress Funds. Ensure such
disclosure adequately addresses the impact the deconsolidation will
have on the content of your Consolidated Statements of Cash Flows as
well as the footnote disclosures you will provide. Based on pro forma
financial information, please also disclose if you would have been
required to include financial statements under Rule 3-09 of Regulation
S-X for any of the Fortress Funds that will be deconsolidated as of
December 31, 2005.

Fortress Investment Group LLC
December 21, 2006
Page 33 of 70

The pro forma financial information section of the
Registration Statement has been revised in response to the Staff's
request. Based on the pro forma financial information, the significance
tests of Rule 3-09 would not have been met for any of the Fortress
Funds that will be deconsolidated as of December 31, 2005. The Company
also respectfully would like to alert the Staff's attention to the
Company's response to Comment No. 22 above.

77. Please revise note (a) to clarify that the management fees and
incentive income that you are recognizing as a result of the
deconsolidation of Fortress Funds were amounts that were previously
eliminated in consolidation.

The disclosure on page 85 has been revised in response to the
Staff's comment. Further, in response to Comment No. 76, we have
inserted additional disclosure in the introduction to the unaudited pro
forma financial information.

78. We note that with the deconsolidation of the Fortress Funds and the
liquidation of Northcastle, you continue to recognize $82,966,000 for
the non-controlling interests in consolidated subsidiaries as of June
30, 2006. Please revise your disclosure in note (a) to state what
non-controlling interests remain.

The disclosure on page 85 has been revised in response to the
Staff's comment.

79. We note that you are adjusting interest expense for the new $750
million credit arrangement based on borrowings of $600 million even
though $665 million of debt was outstanding under the new credit
arrangement as of June 30, 2006. Please either adjust interest expense
for the entire amount borrowed under this facility as of June 30, 2006,
or disclose why you believe an adjustment is required for only $600
million instead of the $665 million borrowed as of June 30, 2006.

The Company respectfully informs the Staff that the Company
has adjusted interest expense for the new $750 million credit
arrangement on a pro forma basis based on the borrowings of $600
million under the term loan facility of the arrangement, which
represent long term borrowings expected to have a material continuing
impact on the Company. The additional $95 million of debt outstanding
under the new credit agreement as of September 30, 2006 is under the
revolving loan facility of the arrangement, which are short-term
borrowings that have and will fluctuate with the Company's financial
requirements.

The Company does not believe that the level of short-term
borrowings under the revolving loan facility as of September 30, 2006
is necessarily indicative of what the continuing impact of these
borrowings will be because of the fluctuating level of revolving loan
borrowings. As such, the Company believes these short-term borrowings
do not meet the inclusion criteria set forth in

Fortress Investment Group LLC
December 21, 2006
Page 34 of 70

Article 11 of Regulation S-X. The Company respectfully informs the
Staff that under both its prior and new credit arrangement there was a
revolving loan facility and the pro forma information reflects the
historical costs of these short-term borrowings, i.e., there is no
adjustment made to these costs. Therefore, we believe that a full
measure of our interest costs is included in the pro forma financial
information.

In consideration of the Staff's comment, the Company has
revised its disclosure throughout the Registration Statement to clarify
and distinguish the borrowings under the term loan facility from those
under the revolving loan facility.

80. We note that your new $750 million credit arrangement is based on a
variable interest rate. As such, please disclose the effect on income
of a 1/8 percent variance in interest rates within note (b). Refer to
Rule 11-02(b)(8) for guidance.

The disclosure on page pages 89-90 has been revised in
response to the Staff's comment.

81. In note (b), please disclose the interest rate of the $233 million of
debt to be repaid for each period presented.

The disclosure on page 89-90 has been revised in response to
the Staff's comment.

82. We note that the primary purpose of the adjustment explained in note
(c) is to depict the distribution of the proceeds from the collection
of a receivable related to previously earned fees to the principals in
connection with the reorganization. However, it is unclear why you are
reflecting the $26,766,000 of the receivable that will not be
distributed to the principals as collected in the pro forma balance
sheet. Please either remove this portion of the adjustment, or explain
to us how you determined such adjustment is in accordance with Article
11 of Regulation S-X.

In consideration of the Staff's comment, the Company has
revised its pro forma information to remove the $26,766,000 portion of
the adjustment that represents proceeds from collection of the
receivable that are not being distributed to the principals.

83. We note as indicated in note (c) that you have made a pro forma income
statement adjustment to eliminate the actual earnings on the portion of
the receivable collected based on the actual earnings on the receivable
in the respective periods. Please clarify why this adjustment is
necessary. Please provide us with the offset to this pro forma
adjustment.

Fortress Investment Group LLC
December 21, 2006
Page 35 of 70

The Company respectfully informs the Staff that it believes it
is important to describe the collection of the receivable and reflect
the elimination of the income earned on the receivable in the pro forma
financial information as the portion funding the distributions to
principals represents approximately 37% of the Company's pro forma
deconsolidated assets as of September 30, 2006. Additionally, the
income earned on the portion of the receivable collected to fund the
distribution to the principals represents approximately 32% of the pro
forma deconsolidated net income for the nine months ended September 30,
2006. The Company believes the collection and distribution of proceeds
represents a material change in the composition of its pro forma assets
and that the pro forma statement of income might be considered
misleading without the removal of the related income on such
receivable. With the collection of the receivable and distribution of
the proceeds to the principals there will be no income from this or any
other replacement source to offset the reduction in income after the
offering. The historical accounting for the receivable was to record
income and increase the receivable during the deferral period. By
removing the receivable and the related income on the pro forma balance
sheet and income statement, respectively, the Company believes that the
full impact of this receivable, which will be collected to make the
principals' distribution, has been appropriately reflected.

84. Regarding note (d)(ii), please provide us with additional details
regarding the five year service requirement for the principals to
maintain ownership of their Fortress Operating Group units and
corresponding Fortress Investment Group Holdings LLC Class B shares,
considering the Fortress Operating Group units at risk of forfeitures
were owned by the principals prior to the reorganization. Please tell
us how you are reflecting this agreement in your consolidated financial
statements, including the authoritative literature that supports your
accounting. Please provide us with a comprehensive discussion of how
you determined the fair value of this agreement.

Prior to the reorganization, the principals as a group owned
all of the Company's outstanding partnership units. As a result of the
reorganization, the Nomura transaction and the offering, the Company
will acquire a controlling general partnership interest and a 23.5% LP
interest in each Fortress Operating Group partnership and the
principals will own the remaining units in each Fortress Operating
Group partnership (in the form of limited partnership interests). In
addition, each principal will receive non-economic voting Class B
Shares equal in number to the number of Fortress Operating Group units
he holds. Each of the principals' Fortress Operating Group units will
be exchangeable (together with the corresponding Class B shares), at
any time and on a one-to-one basis, for the Company's Class A shares.
At the time of exchange, the Class B share corresponding to the
Fortress Operating Group unit surrendered for exchange is also
surrendered and cancelled. The Fortress Operating Group units and Class
B shares are herein referred to as "Forfeitable Interests."

Fortress Investment Group LLC
December 21, 2006
Page 36 of 70

In addition, the principals will enter into an agreement (the
"Principals Agreement") that will become effective upon completion of
the offering. The Principals Agreement provides that 30% of the
Forfeitable Interests are unilaterally and unconditionally owned by the
principals, but all or some portion of the remaining 70% of the
Forfeitable Interests held by the principals will be forfeited if the
principal voluntarily terminates his employment with the Company prior
to the fifth anniversary of the consummation of this offering. If
Forfeitable Interests are forfeited, they are reallocated among the
remaining principals who continue to be employed by the Company. The
Forfeitable Interests vest as follows:

o in the event such termination occurs prior to the first
anniversary of the consummation of the offering, 70% of such
principal's Forfeitable Interests shall be forfeited;

o in the event such termination occurs prior to the second
anniversary of the consummation of the offering, 56% of such
principal's Forfeitable Interests shall be forfeited;

o in the event such termination occurs prior to the third
anniversary of the consummation of the offering, 42% of such
principal's Forfeitable Interests) shall be forfeited;

o in the event such termination occurs prior to the fourth
anniversary of the consummation of the offering, 28% of such
principal's Forfeitable Interests shall be forfeited; and

o in the event such termination occurs prior to the fifth
anniversary of the consummation of the offering, 14% of such
principal's Forfeitable Interests shall be forfeited.

Although Forfeitable Interests may be reallocated among the
remaining principals, no Forfeitable Interests return to the Company.
Further, the principals have the sole right to amend the terms and
conditions of the Principals Agreement and neither the Company nor
remaining shareholders (i.e. individuals other than the principals)
have the ability to enforce any provision thereof or to prevent the
principals from amending the Principals Agreement or waiving any
forfeiture obligation.

The Company evaluated the Principals Agreement and determined
it should account for the Forfeitable Interests in accordance with
paragraph 11 of FAS 123(R), which requires that certain share-based
payments between "economic interest holders" (e.g., investors, lenders
and related parties) of a company to be recorded by that company as
compensation. The Company also considered the guidance in the SEC's
Staff Training Manual on escrowed shares and determined that even
though the principals' Forfeitable Interests technically were not
placed into escrow, the Principals Agreement imposed conditions that
were virtually the same as an escrowed arrangement. Even though the
example

Fortress Investment Group LLC
December 21, 2006
Page 37 of 70

provided by the SEC Staff dealt with performance conditions, the
Company believes that current GAAP (as supported by FAS 123(R)) does
not differentiate between performance and service conditions, and
therefore, the guidance would also apply to arrangements with service
conditions. In this connection, the Company notes that (1) the
principals qualified as economic interest holders since they own the
Company prior to entering into the Principals Agreement and completing
the IPO and (2) the principals also qualified as common law employees
of the Company. Compensation plans similar to this are sometimes
referred to as "last man standing plans."

The Company was not able to overcome the presumption that the
Forfeitable Interests subject to forfeiture are compensatory because
the forfeiture conditions for vesting are tied to the principals'
future employment with the Company and the purpose of the Principals
Agreement is to retain the principals as key employees and officers of
the Company during the first five years after its initial public
offering. Therefore, the Company determined that this arrangement is
for accounting purposes a recapitalization similar to a reverse stock
split for the Forfeitable Interests no longer subject to forfeiture,
followed by the grant of units of the Forfeitable Interests subject to
service conditions.

The Company next assessed how it would measure and recognize
compensation expense in its financial statements. Consistent with a
reverse stock split, the portion of each principal's ownership that is
not subject to forfeiture represents the principals' historical equity
ownership and would not give rise to compensation cost. The Forfeitable
Interest subject to service conditions would be accounted for as a
compensatory share-based award. The requisite service period is the
five-year vesting period identified in the Principals Agreement and
therefore the fair value of the Forfeitable Interests measured at the
grant date is compensation cost that would be recognized over that
period. If, during the requisite service period, one or more of the
principals voluntarily terminates his employment, then the forfeitable
portion of that principal's Forfeitable Interest is considered
forfeited under FAS 123(R) and is reallocated amongst the remaining
principals creating a new award for the amounts reallocated which is
measured at the then fair value. Compensation cost previously
recognized for the forfeited Forfeitable Interests would be reversed
and the fair value of the reallocated Forfeitable Interests would be
recognized over the remaining vesting period. Any previously paid
dividends, which under FAS 123(R) were recorded in equity, would be
recognized as compensation expense.

When evaluating how to measure fair value compensation
expense, the Company noted the exchange option of the Fortress
Operating Group units and Class B shares into Class A shares of the
Company, and considered whether the Unvested Equity Interests represent
an equity grant in the Company or an equity grant in each Fortress
Operating Group unit with a conversion right. In this connection, the
Company also noted that each principal has a pro rata ownership
interest in all Fortress Operating Group partnerships and the Company's
Class B

Fortress Investment Group LLC
December 21, 2006
Page 38 of 70

shares (for example if a principal owns 10% of the Company's Class B
shares, he also holds 10% of the economic interest in each Fortress
Operating Group unit). Therefore, the Company believes that the
Fortress Operating Group units together with the Class B Shares
correspond economically to the Class A shares because (1) all of the
operations occur at the Fortress Operating Group-level (i.e., the
registrant is a holding company with no other independent operations or
operating subsidiaries), (2) the Class B shares of the registrant
incorporated in the award are not economic instruments as they have no
value and do not share in any return of the registrant (i.e., the
economic value of the award is contained entirely within the Fortress
Operating Group units), (3) the right to exchange Fortress Operating
Group units for Class A shares of the Company on a one-to-one basis,
(4) the right of the Class B shares to vote at all shareholder meetings
at which the Company's shareholders are entitled to vote on the basis
of one vote per share, (5) the right of the Fortress Operating Group
units to receive distributions in amounts that correspond to the
dividends to be received on Class A shares, and (6) the right to
participate upon a liquidation event on a corresponding basis with the
holders of the Company's Class A shares in the distribution of assets
of the Company. Therefore, the Company believes that the Fortress
Operating Group units issued as part of this compensatory arrangement
are in substance an economic equivalent to a grant by the Company of
the Company's shares.

Accordingly, with respect to measuring the fair value of the
Unvested Equity Interests, the Company believes that the price of the
Class A shares in the IPO will be a proxy for the Fortress Operating
Group units and Class B Shares since together they are exchangeable for
Class A shares.

85. We note that Fortress Operating Group used a portion of the proceeds of
your new $750 million credit agreement to pay a $250 million
distribution to the principals in June 2006. In addition, we note that
you are using $250 million of the offering proceeds to pay down $250
million of your new $750 million credit agreement. We also note that
Fortress Operating Group made another $42 million distribution to the
principals in July 2006. In connection with the reorganization, we note
that the principals are to receive another distribution of $348.6
million for a portion of receivables relating to previously earned
fees. Together, the $42 million and $348.6 million distributions exceed
net income for fiscal year 2005. Finally, we note that you intend to
make an additional distribution to the principals with the offering
proceeds. When distributions are to be paid from the proceeds of the
offering, which would include using proceeds of the offering to repay
debt used to make distributions prior to the offering, we believe it is
appropriate to include pro forma per share data (for the latest year
and current interim period) giving effect to the number of shares whose
proceeds were to be used to pay the distributions. A similar
presentation is appropriate when distributions exceed earnings in the
current year. In this situation, pro forma per share data should give
effect to the increase in the number of shares

Fortress Investment Group LLC
December 21, 2006
Page 39 of 70

which, when multiplied by the offering price, would be sufficient to
replace the capital in excess of earnings being withdrawn. Please
revise your pro forma financial information to provide such pro forma
earnings per share information. Refer to SAB Topic 1:B.3 for guidance.

The disclosure on pages 81-84 has been revised in response to
the Staff's comment. The revision indicates where the Company will
include pro forma earnings per share information giving effect to the
number of shares whose proceeds are assumed to have been used to pay
distributions to the principals, and on page 92 to include a footnote
to explain the computation. The Company will complete the disclosure in
a subsequent pre-effective amendment to the Registration Statement when
share count information is available.

86. We note that you have not reflected the tax receivable agreement with
your principals, since Fortress Operating Group units held by your
principals are exchangeable based on the principals' sole decision and
no exchanges have occurred or are planned to occur concurrent with this
offering. Please expand this disclosure to clarify for readers the
nature of the impact this agreement could have on your financial
statements.

The Company respectfully informs the Staff that because of the
Nomura transaction, which creates a tax basis step-up that may result
in tax savings subject to the tax receivable agreement, adjustments to
reflect the effects of the tax receivable agreement have now been
included in the pro forma balance sheet information. The Company has
revised the disclosure on pages 79-80 to provide a summary description
of its accounting for the tax receivable agreement arising from the
Nomura transaction and in pro forma footnote on page 88 to explain the
pro forma adjustments resulting from the tax receivable agreement.

The Company is continuing to consider the appropriate
accounting for the tax receivable agreement effects related to Fortress
Operating Group units, whether or not subject to forfeiture, that have
not yet been exchanged or sold, and thus have not yet triggered an
increase in tax basis of assets. Therefore, the Company has only
reflected a pro forma entry for the tax receivable agreement related to
the Fortress Operating Group units sold as part of the Nomura
transaction. The Company believes that upon exchange or sale of the
Fortress Operating Group units, the best measure of its liability under
the tax receivable agreement is an undiscounted amount to correspond to
the undiscounted FAS 109 deferred tax asset resulting from the step-up
in asset value. The Company currently believes that the charge arising
from the establishment of the initial liability should be accounted for
in a manner consistent with the accounting for the establishment of the
initial deferred tax asset under EITF 94-10, as an equity transaction
with any subsequent change in both the deferred tax asset and
corresponding liability under the tax receivable agreement reflected in
income.

Fortress Investment Group LLC
December 21, 2006
Page 40 of 70

Management's Discussion and Analysis of Financial Condition and Results of
--------------------------------------------------------------------------
Operations, page 75
-------------------

Results of Operations on a Historical Basis, page 82
----------------------------------------------------

87. Please expand/revise the discussion of your results of operations for
each period presented to address the following items:

o Provide a more comprehensive analysis of the factors that impacted
your revenues and other income, ensuring that you address the
specific underlying causes for such changes. If necessary, you may
need to identify each underlying material fund or category of
funds (private equity, liquid hedge, etc) you manage and provide
specific details such that an investor can clearly differentiate
how and why pertinent factors impacted the related revenues and
other income you have recognized in each period presented. In
addition you should discuss known or anticipated trends that have
and/or may continue to have on your results of operations. Your
discussion and analysis is to provide investors with sufficient
information to understand the historical trends and the
expectations for the future as seen through the eyes of
management. Your discussion and analysis should explain the
information that is obtainable from your financial statements and
footnote disclosures and not just repeat such information.
Examples include the following:

o Provide a sufficiently detailed explanation as to why an
event or transaction has occurred and is impacting the
specific line item through your discussion on a combined
basis and reportable segment level for each period presented.

o Ensure that you are explaining the majority of increases or
decreases in each line item.

o Quantify the impact of each factor you identify when multiple and
offsetting factors contribute to fluctuations through the use of a
tabular presentation

Please note that this is not meant to represent an all-inclusive list
of where your MD&A could be improved. There are many areas that we are
not specifically identifying that need to have further analysis
throughout your current discussion. Refer to Item 303 of Regulation
S-K, Section 501 of the Financial Reporting Codification, and SEC
Interpretive Release No. 33-8350 dated December 19, 2003 for additional
guidance.

The disclosure throughout the MD&A section has been revised in
response to the Staff's comments.

88. Your explanation for the increase in gains from other investments
indicates that it is partially attributable to an increase in value of
your receivable from previously

Fortress Investment Group LLC
December 21, 2006
Page 41 of 70

earned fees. Please clarify throughout MD&A what you mean by this
statement. Please refer to page 86.

The disclosure on page 119 has been revised in response to the
Staff's comment in a manner which clarifies the discussion throughout
management's discussion and analysis of gains attributable to the
performance of investments in respect of which offshore hedge fund
receivables are indexed.

Historical Liquidity and Capital Resources, page 93
---------------------------------------------------

89. We note that for each period presented you have recognized negative
operating cash flows. Please revise your discussion on pages 93 and 94
to provide a more comprehensive analysis as to why you continue to
recognize negative cash flows. Your discussion should not merely repeat
information that is obtainable from your financial statements. Refer to
Item 303 of Regulation S-K and Sections 501.03 and 501.13 of the
Financial Reporting Codification for additional guidance.

The disclosure on pages 125 and 126 has been revised in
response to the Staff's comment

90. Please disclose the extent to which Fortress Operating Group received
interest in Funds for nominal or no cash outlay for each period
presented.

The disclosure on page 125 has been revised in response to the
Staff's comment.

Application of Critical Accounting Policies, page 94
----------------------------------------------------

Revenue Recognition on Incentive Income, page 95
------------------------------------------------

91. Please disclose the various points in which contingencies on your
recognition of incentive income become resolved.

The disclosure on page 128 has been revised in response to the
Staff's comment.

92. For the reserve you estimate related to incentive income that is
included in your non-GAAP measure, distributable earnings, please state
the amount of incentive income recognized and the amount of the reserve
applied against such amounts by reportable segment for each period
presented. Please also include a sensitivity analysis for your
estimation of the reserve and clarify why for the purposes of
calculated distributable earnings you determine whether the clawback
reserve, as determined under GAAP, is necessary.

Fortress Investment Group LLC
December 21, 2006
Page 42 of 70

The disclosure on pages 127-128 has been updated in response
to the Staff's comment. The Company respectfully advises the Staff that
it has not recognized a reserve on the collection or clawback of
incentive income in the periods presented.

The Company supplementally advises the Staff that the analysis
of whether to take an incentive income reserve is impacted
significantly by the level of unrealized gains remaining in the fund.
As the obligation to make a clawback payment only becomes due at the
end of a fund, we take into account such unrealized gain on the fund's
portfolio companies when evaluating the probability of clawback before
a clawback is due. As described on page 144 of the Registration
Statement, our private equity funds have embedded gains in excess of
$7.5 billion, which puts the likelihood of a clawback as remote. Thus,
due to the remote nature of the clawback, we have taken no reserve
against our private equity incentive income received to date.

Valuation of Investments, page 96
---------------------------------

93. Please substantively revise your disclosure for the following:

o Explanation of each of the models/techniques used to estimate fair
value of the investments;

o Detailed discussion of the material estimates and assumptions used
in each of the models;

o Sensitivity analysis of the material estimates and assumptions for
each of the models used on the fair value of the investments; and

o A sensitivity analysis of the impact material changes in estimates
and assumptions in estimating the fair value of the investments
could have on the management fees and incentive income recognized
and/or deferred.

Please refer to Section 501.14 of the Financial Reporting Codification
for guidance.

The disclosure on pages 128-129 has been revised in response
to the Staff's comment.

94. You indicate in your accounting policy on page F-l1 that the fair
values obtained from external sources or models may be adjusted if a
more accurate value can be obtained by recent trading history or by
incorporating other relevant information that may not have been
reflected in the pricing obtained from external sources. Please address
for us the extent to which you have revised fair values obtained from
external sources and your basis for such revisions.

Fortress Investment Group LLC
December 21, 2006
Page 43 of 70

The Company respectfully informs the Staff that Fortress has
revised fair values obtained from external sources based on its
internal models in significantly less than 1% of its fair value
estimates (based on dollars of investments). The primary reason for
such revisions is the discovery that the external source based its
estimate on out-of-date data, for which the Company has obtained more
recent data.

In addition, in some cases the Company obtains fair value
estimates or inputs from multiple external sources, in which case we
generally use an average, discarding any outliers. In other cases, we
may obtain both a "price" for an asset and the associated inputs used
by an external source in arriving at that price. If multiple external
sources use the same inputs but come to different price conclusions, we
may take these inputs and put them into a Company model. If this model
arrives at a price which is within the range provided by the external
sources, we would use this price rather than an average.

95. We note that the investments held by Fortress Funds, which are the
basis for recognizing management fees and incentive income, are
estimated by:

o Independent valuation agents, using their own proprietary
valuation models,

o Your own proprietary valuation models with substantial market
inputs,

o Your own proprietary valuation models that are more theoretical,
or

o Market value.

Please disclose the percentage by which the fair values of Fortress
Funds are estimated by each of the above listed models or techniques.

The disclosure on page 128-131 has been revised in response to
the Staff's comment

Contractual Obligations, page 98
--------------------------------

96. Considering the significant increase in your outstanding long-term debt
obligations as of June 30, 2006, please update the table to present
information as of June 30, 2006. In addition, please revise footnote 5
to include your assumptions in estimating interest to be paid, as we
note some of your debt obligations are at variable interest rates.

The contractual obligations schedule has been updated to
present obligations as of September 30, 2006. Further, footnote 1
(which was the "footnote 5" referred to in the Staff's comment in the
Registration Statement as filed on November 8, 2006) has been updated
to describe the assumptions used in calculating interest on these
obligations.

Fortress Investment Group LLC
December 21, 2006
Page 44 of 70

Qualitative and Quantitative Disclosures About Market Risk, page 98
-------------------------------------------------------------------

97. Please substantively revise your disclosure to provide the information
required by Item 305 of Regulation S-K for each of the following market
risks:

o Purchasing of securities sold that have not yet been purchased;

o Fluctuation in the fair value of Fortress Funds investments;

o Fluctuation in interest rates for your variable debt instruments;
and

o Fluctuations in exchange rates.

Specifically, state how you manage each of the above market risks. In
addition, include quantitative disclosures using one of the three
prescribed methods. Refer to Section 507.02 of the Financial Reporting
Codification for additional guidance.

The disclosure on pages 134-135 has been revised in response
to the Staff's comments.

Industry, page 101
------------------

98. We note your reference to statistics reported by McKinsey & Company.
Please provide their consent in an exhibit in accordance with Rule
436(a) of Regulation C.

The Company respectfully informs the Staff that the
information referred to in Comment No. 98 was derived either from
reports that are publicly available or from reports made generally
available to its subscribers by the publisher, none of which was
specifically prepared for or on behalf of the Company. Therefore, the
Company does not believe that a consent is required pursuant to Rule
436(a) of Regulation C.

Business, page 106
------------------

99. We note the lead in sentence to the performance table on page 109
states that only "certain" of the funds are listed. Please include all
your funds or explain why you only list certain of the funds. Clarify
whether the principals or their affiliates will have operations or a
business that is separate from the company. Are there any funds or
investments that these entities will manage or control outside of the
company?

The disclosure on page 149 has been revised in response to the
Staff's comment.

Fortress Investment Group LLC
December 21, 2006
Page 45 of 70

control, other than via the Fortress Operating Group entities, any
investment management or investment-related business. The Company
respectfully informs the Staff that each of the principals maintains an
investment portfolio, but these are, in each case, personal investment
portfolios, not businesses that are held in common by the principals.
In addition, the principals do not hold in any personal capacity any
portion of the carried interest in, or any right to any portion of the
management fees paid by, any fund that has ever been managed by
Fortress. A central premise of the principals' decision to enable
public investors to participate in Fortress's business - by creating a
public company that would, through the intermediate holding companies,
become a partner in the Fortress Operating Group - is that the entirety
of their business interests should be owned by investment management
business in which the public is, indirectly, investing.

100. We note your table on page 112 showing information regarding your
private equity funds. Please expand this table to include all your
funds, including the hedge funds, and Castles to identify as
applicable:

o the IRR or, if not a fund, a comparable performance measure,

o whether each fund is registered or unregistered,

o the general manager or investment advisor for each fund, and

o information regarding fees and income received.

The table on page 149 has been revised in response to the
Staff's comment. In addition, the disclosure on pages 147, 152, 156 has
been revised in response to the last part of the Staff's comment to
reflect for each group of funds the percentage of revenues attributable
to that group of funds.

The Company respectfully informs the Staff that, with respect
to its hedge funds, whose interests are offered on a continuous basis,
the Company does not disclose IRRs of those hedge funds, on a fund by
fund basis. For the Staff's information, the Company supplementally
includes the requested information of a fund by fund basis below.

Fortress Investment Group LLC
December 21, 2006
Page 46 of 70

($ in millions) September 30, 2006
--------------------------------------
Net
Inception Registered (1) Annualized
Liquid Hedge Funds Date (Y/N) AUM (2) Returns (3)
------------------------------------------------------------------------------------------------------------------------------------

Global Macro LP (4) Jun-02 N $ 401 14.0%
Global Macro LTD (4) Jun-02 N 4,004 14.2%
----------------- --------------------
Subtotal - Global Macro Funds $ 4,405 14.2%
----------------- --------------------

Relative Value Fund LP (5) Feb-05 N $ 30 2.6%
Relative Value Fund LTD (5) Feb-05 N $ 130 2.7%
----------------- --------------------
Subtotal - Relative Value Funds $ 160 2.7%
----------------- --------------------
Total Liquid Hedge Funds $ 4,565 13.3%
----------------- --------------------

Hybrid Hedge Funds
------------------------------------------------------------------------------------------------------------------------------------
Special Opportunities LP (6) Aug-02 N $ 4,022 13.8%
Special Opportunities LTD (6) Aug-02 N 540 13.3%
----------------- --------------------
Subtotal - Special Opportunities Funds $ 4,562 13.7%
----------------- --------------------

Fortress Partners Fund Jul-06 N $ 261 14.6%
----------------- --------------------
Total Hybrid Hedge Funds $ 4,823 13.7%
----------------- --------------------

(1) Registered as an investment company under the Investment Company Act of
1940.
(2) "AUM" is assets under management as of September 30, 2006.
(3) The net annualized returns are as of September 30, 2006, and reflect
monthly returns for a "new issue eligible" investor investing in the funds
at their inception net of all fees and expenses borne by the fund.
Allocation of new issues to new issue elig
(4) Managed by Drawbridge Global Macro Advisors LLC. Drawbridge Global Macro
Advisors LLC and each of the other investment management entities referred
to in this table are subsidiaries of the Operating Entities.
(5) Managed by Drawbridge Relative Value Advisors LLC.
(6) Managed by Drawbridge Special Opportunities Advisors LLC.

101. Please discuss the key man provisions contained in some of your funds.

The disclosure on page 31-32 has been revised in response to
the Staff's comment.

102. Describe how you fund your direct equity investments.

The disclosure on pages 125 and 142 has been revised in
response to the Staff's comment.

103. Explain how you structure the funds and how initial capital commitments
are determined and funded. Do the principals, the company or their
affiliates directly invest in the funds or do they use carried
interest? If they use direct investments, how are they funded? As
appropriate, please also address this comment under the Liquidity and
Capital Resources section in MD&A.

The disclosure on pages 125 and 142 has been revised in
response to the first part of the Staff's comment.

Fortress Investment Group LLC
December 21, 2006
Page 47 of 70

The Company respectfully informs the Staff that the Company's
initial minimum capital commitments to private equity funds are
generally set forth in the private placement memorandum used to offer
interests in the applicable fund to prospective investors. Investors
are not generally inclined to make substantial commitments to a fund in
respect of which a general partner makes less than a 1.5% capital
commitment, and that amount is the standard amount set forth in
offering documents for the Company's main private equity funds as the
minimum capital commitment that will be made by the general partner and
its affiliates. By way of example, in the case of the Company's most
recent private equity fund, Fund IV, that amounts to a $45 million
minimum initial capital commitment. The Company determines whether to
make capital commitments to its private equity funds in excess of its
minimum required amounts based on a variety of factors, including
estimates regarding the Company's liquidity over the estimated time
period during which commitments will have to be funded, estimates
regarding the amounts of capital that may be appropriate for other
funds which the Company is in the process of raising or is considering
raising, and the Company's general working capital requirements.

The Company respectfully informs the Staff that substantially
all of the Company's principal investments in the Fortress Funds,
whether made directly by one or another of the Fortress Operating Group
entities, are funded directly with cash, and not with carried interest.
The Company does not hold any principal investments in the funds other
than through the Fortress Operating Group entities. As indicated in the
response to Comment 12 above, the principals do not own any portion of
the carried interest in any fund personally; accordingly, their
personal investments in the funds are funded directly with cash.

104. Describe the material terms of your material agreements, such as your
investment management agreements.

The disclosure throughout the "Business" section has been
revised in response to the Staff's comment. The Company respectfully
informs the Staff that the central terms of its management agreements
relate to the fee and, in the case of hedge funds, liquidity (i.e.,
lock-up, redemption) provisions of the funds we manage, which are
generally described in the Registration Statement for significant
funds.

105. Describe the legal remedies, whether by agreement or otherwise, that
investors or the funds have against the company, the principals or
their affiliates to recover losses related to misrepresentation, fraud
or poor investments.

The disclosure on page 35 has been revised in response to the
Staff's comment.

Fortress Investment Group LLC
December 21, 2006
Page 48 of 70

Legal Proceedings, page 123
---------------------------

106. Please disclose the name of the court in which the proceeding is
pending, the principal parties thereto, and describe in greater detail
the factual basis alleged to underlie the proceeding. See Item 103 of
Regulation S-K.

The disclosure on page 162 has been revised in response to the
Staff's comment.

Management, page 124
--------------------

107. Please briefly describe the terms of the shareholders agreement in the
first paragraph and clarify your disclosure that each director is
elected by your shareholders.

The Company respectfully informs the Staff that directors will
be elected by a plurality of the votes cast by holders of our Class A
shares and Class B shares, voting as a single class, for a particular
position.

The disclosure on page 164 has been revised in response to the
Staff's comment.

108. Please explain to us how a majority of your directors will be
considered independent given that the shareholders agreement requires
that six out of the eleven directors will be designated by the
principals.

The Company respectfully informs the Staff that a majority of
the eleven-member board of directors, including at least one of those
designated by the principals, will consist of persons who satisfy the
independence requirements of Section 303A.02 of the NYSE Listed Company
Manual. Once the directors have been so designated, the Company will
make the required disclosure of the board's determination that each
"independent" director has no material relationship with the Company.

109. Please tell us how you intend to structure your board. Do you intend to
use the five existing director positions held by the principals as part
of the six directors the principals can designate or do the principals
intend to designate six additional new directors in addition to their
positions on the board?

The Company respectfully informs the Staff that the principals
intend to designate themselves, plus one additional person who will
qualify as an independent director under applicable regulations, as the
six directors that the principals are permitted to so designate under
the shareholders agreement.

Fortress Investment Group LLC
December 21, 2006
Page 49 of 70

110. Please also include each principal's employment title at the company in
the position column. Please disclose whether any of these positions,
other than the chief executive officer position already disclosed, are
executive officer positions. For example, if the principals are
employed as principals, please clarify whether this is their executive
officer position.

The Company will make further disclosures about the employment
title and related information with respect to each principal in a
subsequent amendment to the Registration Statement.

111. Please explain why you intend to also issue class B shares under the
equity incentive plan since they have no economic value. Also disclose
what type or class of employees, directors or key persons would receive
such shares.

The disclosure on page 172 has been revised in response to the
Staff's comment. In addition, the Company respectfully refers the Staff
to the Company's response to Comment No. 50.

Certain Relationships and Related Party Transactions, page 133
--------------------------------------------------------------

112. It appears that some of the related party transaction disclosure in the
financial statement footnotes is not disclosed in this section. Please
revise or explain why this disclosure is not required.

The Company has revised the disclosure on pages 180-181 in
response to the Staff's comment.

113. We note that under the Shareholders Agreement with the principals, the
principals have registration rights with respect to the Fortress
Investment Group Holdings LLC securities that they own. Based on the
pro forma financial statements, it does not appear that you are going
to recognize the registration rights as a derivative that is
marked-to-market each reporting period. As such, citing relevant
accounting literature, please tell us how you intend to account for the
registration rights, including your consideration of SFAS 133 and EITF
00-19.

The Company respectfully informs the Staff that it does not
believe that the registration rights should be accounted for as
derivatives under SFAS 133 because the registration rights arrangement
does not require a transfer of consideration (payment) in the event the
Company is unable to file or have declared effective a registration
statement or have the registration statement remain effective for a
specified period (e.g., liquidated damages). (The same is true, mutatis
mutandis, in respect of the registration rights granted to Nomura).
Since there are no penalties associated with the failure to register
the sale of the shares, the Company does not believe there is a
derivative liability that needs to

Fortress Investment Group LLC
December 21, 2006
Page 50 of 70

be bifurcated and accounted separately from the Fortress Operating
Group unit. In addition, there does not appear to be a notional amount,
nor does the underlying cost of registration appear to be a financial
asset nor does the contract provide a mechanism for net settlement.
Therefore, the Company evaluated the registration rights and the
Fortress Operating Group units as a single financial instrument for
purposes of assessing SFAS 133 and EITF 00-19. That assessment resulted
in our conclusion that the Fortress Operating Group units and their
associated registration rights should be accounted for as equity of the
Fortress Operating Group and non-controlling interests in
consolidation.

Description of Indebtedness, page 139
-------------------------------------

114. Please describe in greater detail the material financial covenants in
your credit agreement.

The disclosure on pages 185 and 186 has been revised in
response to the Staff's comment.

Description of Shares, page 140
-------------------------------

115. Please also include a description of the units and the operating
agreement for the Fortress Operating Group since you are dependent upon
distributions from the operating group to pay dividends, taxes and
other expenses.

The disclosure on pages 196 and 199 has been revised in
response to the Staff's comment.

Amended and Restated Operating Agreement, page 142
--------------------------------------------------

116. Please describe how the operating agreement modifies the duties of your
officers and directors.

Please see the Company's response to Comment No. 45.

Material U.S. Federal Income Considerations, page 152
-----------------------------------------------------

117. If you are filing a short-form tax opinion, please clarify that this
disclosure is the opinion. We may have further comments after reviewing
your response.

The Company respectfully submits to the Staff that the
disclosure in the section "Material U.S. Federal Tax Considerations"
is, itself, not an opinion, but rather a summary of the material income
tax considerations relating to an investment in Class A shares. The
disclosure in such section, however, has been revised in two
significant ways: (i) to make clear it summarizes all rather than

Fortress Investment Group LLC
December 21, 2006
Page 51 of 70

only certain of the material U.S. federal income tax considerations
relating to an investment in Class A shares; and (ii) to make clear
that Skadden, Arps, Slate, Meagher & Flom LLP will issue an opinion
concluding that the Company will be treated as a partnership for U.S.
federal income tax purposes.

118. Please revise the first sentence to reflect that the discussion
summarizes material tax considerations.

The disclosure on page 203 has been revised in response to the
Staff's comment.

119. You must clearly provide current disclosure regarding the tax
consequences of the transaction to investors. If doubt exists because
of a lack of authority addressing the tax consequences, please explain
why counsel cannot give a "will" opinion, describe the degree of
uncertainty in the opinion and provide risk factor disclosure setting
forth the risk to investors. Alternatively, please delete words such as
"we believe," "we expect," "we anticipate" or "the discussion assumes"
that we will be treated as a partnership for federal income tax
purposes or words that describe tax consequences "generally."

The disclosure in the section "Material U.S. Federal Tax
Considerations" has been revised in response to the Staff's comment. We
have deleted words such as "we believe," "we expect," "we anticipate,
"the discussion assumes," and words that describe tax consequences
generally. The Company respectfully submits to the Staff that, in
certain circumstances, the use of the term generally has been retained
because the tax rule which is being summarized contains an immaterial
exception, or an exception that is discussed within the body of the
disclosure. The Company respectfully submits to the staff that, in
certain limited circumstances, the use of the phrase "we expect" have
been retained to indicate a situation where we will attempt to achieve
a specific tax result based upon a particular factual situation. We
respectfully submit that it is important to indicate the expected
result but also note the consequences if such expectations are not
achieved, which is also fully disclosed. In addition, concerning the
central tax issue of importance to the Company, the disclosure has been
revised to indicate that an opinion of Skadden, Arps, Slate, Meagher &
Flom LLP will be received concluding that the Company will be treated
as a partnership for U.S. federal income tax purposes.

Where You Can Find More Information, page 170
---------------------------------------------

120. Please remove the language in the middle of the first paragraph that
qualifies statements you make in the prospectus by reference to
information outside of the prospectus. Rule 411(a) permits this type of
qualification only where contemplated by the application form.

Fortress Investment Group LLC
December 21, 2006
Page 52 of 70

The disclosure on page 222 has been revised in response to the
Staff's comment.

General - Financial Statements
------------------------------

121. Please include audited financial statements for the registrant,
Fortress Investment Group Holdings LLC. Refer to Item 11 of Form S-1
for guidance.

The disclosure on pages F-72 and F-73 has been revised in
response to the Staff's comment to include audited financial statements
for the registrant, Fortress Investment Group Holdings LLC, which are
comprised of a balance sheet at the date of formation. As indicated in
our response to Comment No. 1, we intend to change the name of the
registrant to "Fortress Investment Group LLC" prior to the completion
of the offering.

122. Please provide updated financial statements and related disclosures for
the interim period ended September 30, 2006, as required by Rule 3-12
of Regulation S-X.

The Registration Statement has been revised in response to the
Staff's comment.

123. We note that Fortress is in the process of finalizing its acquisition
of RailAmerica for $1.1 billion. Please tell us supplementally and
provide disclosures regarding this transaction. Specifically, tell us
which entity is purchasing RailAmerica, whether the acquiring entity is
consolidated or unconsolidated in Fortress Operating Group, and whether
you intend to include financial statements for this acquisition in
accordance with Rule 3-05 of Regulation S-X and pro forma financial
statements in accordance with Article 11 of Regulation S-X. If you do
not intend to provide Rule 3-05 of Regulation S-X financial statements,
please provide us with your analysis for such determination. If you do
provide Rule 3-05 of Regulation S-X financial statements, please
provide us with the significance tests.

The Company respectfully informs the Staff that, as indicated
in the response to Comment No. 15 above, RailAmerica was acquired not
by Fortress Investment Group, but by Fund IV, managed by Fortress,
which, until its deconsolidation is effected, remains an investment
company subsidiary of Fortress under GAAP. Fund IV will account for its
investment in the securities of RailAmerica as a portfolio investment
at fair value, following specialized investment company accounting for
investment companies. The AICPA Audit and Accounting Guide: Investment
Companies (the "Investment Company Guide") paragraph 7.04 provides
that, "... consolidation or use of the equity method of accounting by
an investment company of a non-investment company

Fortress Investment Group LLC
December 21, 2006
Page 53 of 70

investee is not appropriate." Instead, investment companies account for
investments in securities of portfolio companies at fair value with
changes in fair value included in results of operations. Accordingly,
Fund IV does not account for its acquisition of portfolio company
securities as a purchase business combination. When consolidating Fund
IV, Fortress retains its specialized accounting principles in
accordance with EITF Issue No. 85-12, Retention of Specialized
Accounting for Investments in Consolidation. The nature of the purchase
of RailAmerica is to be made in the ordinary course of business of
Fortress Investment Group's subsidiary investment company, Fund IV.

Rule 3-05 of Regulation S-X requires financial statements to
be furnished for material acquisitions if "[c]onsummation of a business
combination accounted for as a purchase has occurred or is probable
(for purposes of this rule, the term "purchase" encompasses the
purchase of an interest in a business accounted for by the equity
method)." The Company believes that Rule 3-05 is not applicable to
purchases of portfolio company securities by investment companies as
those purchases are not "business combinations accounted for as a
purchase." Article 11 pro forma financial information "need not be
presented ... if separate financial statements of the acquired business
are not included in the filing [pursuant to Rule 3-05]." Accordingly,
the Company also believes pro forma financial information is not
required.

124. We note that Fortress has agreed to purchase Champion Mortgage's
origination platform from KeyCorp. Please tell us more about this
transaction. Specifically, tell us and provide disclosures regarding
which entity intends to purchase this entity, whether the acquiring
entity is consolidated or unconsolidated in Fortress Operating Group,
the estimated purchase price, and whether you intend to include
financial statements for this acquisition in accordance with Rule 3-05
of Regulation S-X and pro forma financial statements in accordance with
Article 11 of Regulation S-X. If you do not intend to provide Rule 3-05
of Regulation S-X financial statements, please provide us with your
analysis for such determination. If you do provide Rule 3-05 of
Regulation S-X financial statements, please provide us with the
significance tests.

As indicated in the response to Comment No. 15 above, Champion
Mortgage's loan origination platform was acquired not by Fortress
Investment Group, but by a portfolio company of certain of Fortress's
private equity funds (Fund III and Fund IV). The Funds will account for
this investment at fair value as a portfolio investment (or as an
increase in the value of an existing portfolio investment), following
specialized investment company accounting for investment companies. The
Investment Company Guide, paragraph 7.04 provides that, "...
consolidation or use of the equity method of accounting by an
investment company of a non-investment company investee is not
appropriate." Instead, investment companies account for investments in
securities of portfolio

Fortress Investment Group LLC
December 21, 2006
Page 54 of 70

companies at fair value with changes in fair value included in results
of operations. Accordingly, the Funds do not account for their
acquisition of portfolio company securities as a purchase business
combination. When consolidating the Funds, Fortress retains the
specialized accounting principles in accordance with EITF Issue No.
85-12. The nature of the purchase of Champion Mortgage's loan
origination platform is to be made in the ordinary course of business
of Fortress Investment Group's subsidiary investment companies, Fund
III and Fund IV.

For the reasons set forth in its response to Comment No. 123, the
Company believes no pro forma financial information is required.

Fortress Operating Group (Limited Liability Companies) for the Fiscal Year Ended
--------------------------------------------------------------------------------
December 31, 2005, page F-2
---------------------------

Combined Income Statements, page F-4
------------------------------------

125. Please help us to understand the appropriateness of your presentation
of the line item deferred incentive income after "Income Before
Deferred Incentive Income, Non-Controlling Interests in Income of
Consolidated Subsidiaries and Income Taxes."

o It is unclear to us why this presentation is necessary given your
accounting policy of not recognizing incentive income prior to the
resolution of all contingencies. Please advise.

o Notwithstanding the above bullet, help us to understand the
appropriateness of your income statement presentation.
Specifically address whether this presentation is a result of
recognizing certain incentive income gross rather than net. If so,
refer to EITF 99-19 and address the appropriateness of this
presentation.

o It appears to us that this presentation may result in a non-GAAP
measure as contemplated by Item 10(e) of Regulation S-X. If so, it
is unclear to us that you should present this measure on the face
of your statement of operations. Please advise.

o For further clarification, please provide us with the journal
entries related to your recognition of deferred incentive income,
including those that resulted in the adjustment for deferred
incentive income presented after "Income Before Deferred Incentive
Income, Non-Controlling Interests in Income of Consolidated
Subsidiaries and Income Taxes."

o Provide a detailed rollforward of the activities within your
deferred incentive income liability. Provide a discussion of how
and when you determine the recognition of deferred incentive
income upon resolution of all contingencies.

Fortress Investment Group LLC
December 21, 2006
Page 55 of 70

The Company earns incentive income subject to clawback
contingencies. The accounting policy we have adopted for incentive
income is Method 1 under EITF Topic D-96 ("D-96 Method 1"), whereby all
incentive income is deferred until the related contingencies are
resolved. On an unconsolidated basis, we implement D-96 Method 1 by not
accruing incentive income until the clawback contingency is resolved
and, when we receive a cash distribution of incentive income from a
fund before resolution of the clawback contingency, recording a
deferred incentive income liability. However, implementing D-96 Method
1 for consolidated funds is not as straight forward because the gross
income of these entities is included in the Company's consolidated
income statements. The question we faced in preparing our financial
statements was how to treat the portion of this gross income which
theoretically would be allocated to the Company as incentive income in
the future. We developed two alternative views.

Under the first view, this portion of the gross income would
simply be treated as pertaining to the non-controlling interests (a
reduction of income and a mezzanine liability/equity credit) until such
time as the clawback contingency is resolved. Under this view, the
non-controlling interests on the balance sheet would be overstated
based on a hypothetical liquidation at book value because, under such a
scenario, the unrecognized incentive income portion of the gross income
should be allocated to the Company. In other words, under this view our
selected accounting method for incentive income conflicts with the
proper accounting for non-controlling interests.

Under the second view, this portion of the gross income would
be treated as pertaining to the Company but deferred until such time
that it became recognizable, by reducing income under the caption
"Deferred Incentive Income" and increasing the liability recorded for
deferred incentive income. We, along with our auditors, felt that this
method was more appropriate because it properly states the income and
equity of both the Company and the non-controlling interests.

The only other option is to assume that D-96 Method 1 does not
pertain to incentive income from consolidated entities. Under this
scenario, our net income on a consolidated and unconsolidated basis
would differ, and this could result in recognizing such income twice -
once on a gross basis prior to deconsolidation and secondly on a net
basis upon resolution of the clawback contingencies subsequent to
deconsolidation. This clearly would not be proper.

The Company does not believe the method we chose results in
the presentation of a non-GAAP measure as we believe that the
presentation of the deferred incentive income along with the
non-controlling interests in income of consolidated subsidiaries is
GAAP. Although we believe it should not be recorded as belonging to the
non-controlling interests for the reasons enumerated above, we

Fortress Investment Group LLC
December 21, 2006
Page 56 of 70

do believe that it should be eliminated from net income until such time
as the clawback contingencies are resolved, in a manner similar to
recording the non-controlling interests in net income. As such,
presenting these two income statement items together seems appropriate.
Furthermore, the gross income to which this portion relates is spread
through each section of the income statements and applying this
reduction of income to any one particular section would not appear to
appropriately match the items.

The Company notes that our incentive income liability has been
impacted by only two types of entries: 1) incentive income
distributions received, and 2) the entries discussed above. A
discussion of how and when we determine the recognition of deferred
incentive income upon resolution of all contingencies has been added to
our critical accounting policies in response to Comment No. 91.

The following provides an example of the journal entries related to the
recognition of deferred incentive income and the effect that the
consolidation of the funds have thereon.

Fortress Investment Group LLC
December 21, 2006
Page 57 of 70

Example:

Income statement of Fund A for the year ended December 31, 2005

Revenue $ 200
Expense (100)
----------
Net income $ 100
===========

|X| FOG as the investment manager is allocated 20% of the net income,
$20, as promote fees allocation (FOG in its separate company
financial statements defers this promote fee under Method 1 of
EITF Topic D-96).

|X| FOG as the GP is allocated $1 and the LPs are allocated $79 of
income after the promote allocation.

|X| FOG, on a stand-alone basis, records $1 as earnings from equity
method investees.

GP's promote fees $ 20
GP's allocated income 1
LPs' allocated income 79
----------
Total $ 100
==========

Consolidation of income statement:

Consolidation &
FOG Fund A Elimination Consolidated
----------- ---------- -------------------- -----------------

Revenue $ 1 $ 200 $ (1) $ 200
Expense - (100) - (100)
Deferred incentive income - - (20) (20)
Minority interest - - (79) (79)
----------- ---------- -------------------- -----------------
Net income $ 1 $ 100 $ (100) $ 1
=========== ========== ==================== =================

As requested, a rollforward of the deferred incentive income liability
is as follows:

(dollars in millions)

Balance at December 31, 2003 $ 36.7
Expense for the year ended December 31, 2004 104.6
------------
Balance at December 31, 2004 141.3
Expense for the year ended December 31, 2005 444.6
------------
Balance at December 31, 2005 585.9
Expense for the nine months ended September 30, 2006 475.6
------------
Balance at September 30, 2006 $ 1,061.5
=============

Fortress Investment Group LLC
December 21, 2006
Page 58 of 70

Combined Statements of Cash Flows, page F-6
-------------------------------------------

126. We note that you do not include cash held at consolidated subsidiaries
as a cash and cash equivalents for the purposes of presenting your
statement of cash flows because these funds are not available to fund
the general liquidity needs of Fortress. Please refer to SFAS 95 and
tell us your basis for this presentation.

The Company respectfully notes that its statements of cash
flows present all of its cash flow activities, including cash flows
related to cash held at consolidated subsidiaries, as this most
accurately reflects the cash flow activities of the Company on a
consolidated basis.

However, the cash held at consolidated subsidiaries is not
presented with cash and cash equivalents on the face of the balance
sheets, or in the beginning or ending balances of cash and cash
equivalents in the statements of cash flows, because it is not freely
available to fund the general liquidity needs of the Company, including
dividends but rather is property of the relevant fund and, upon
distribution, substantially belongs to the investors. The Company
receives only the fees it earns from these subsidiaries, as well as its
portion of the distributions made by these subsidiaries, and the timing
and amount of these payments is not wholly under the control of the
Company.

The Company notes that ARB 43 states that cash which is
"restricted as to... use for other than current operations" should be
excluded from current assets and that SFAS 95 relates only to cash and
cash equivalents designated as such on the balance sheet (paragraph 7).
While the cash held at these consolidated funds is freely usable by
them for their own cash needs (i.e. it is not legally restricted by
debt covenants, foreign governments or the like), it is not available
for the general current operations of the Company. As such, we believe
our presentation best reflects both our cash flows (on a consolidated
basis) and the cash and cash equivalents available to satisfy the
liquidity needs of the Company.

127. Please reconcile undistributed earnings from equity method investees
reflected in your cash flows from operations for each period presented
to earnings from equity method investees on your combined income
statements.

The Company respectfully sets forth below a reconciliation of
undistributed earnings from equity method investees as presented on our
combined statements of cash flows to earnings from equity method
investees as presented on our combined income statements for the years
ended December 31, 2005, 2004 and 2003, and for the nine months ended
September 30, 2006 and 2005.

Fortress Investment Group LLC
December 21, 2006
Page 59 of 70

Reconciliation of Undistributed Earnings to Earnings from Equity Method Investees
---------------------------------------------------------------------------------

-----------------------------------------------------------------------------------------------------------------------------------
For the nine months For the nine months
For the year ended For the year ended For the year ended ended ended
Description December 31, 2005 December 31, 2004 December 31, 2003 September 30, 2006 September 30, 2005
-----------------------------------------------------------------------------------------------------------------------------------

Undistributed earnings from
equity method investees $ 2,158 $ 8,851 $ - $ - $ 1,823

(+) Dividend distributions from
equity method investees: 7,908 4,889 5,116 7,057 6,821

(+) Redemptions from the CDO
Vehicles 399 876 124 572 371

(-) Distributions of capital
from equity method investees
in excess of earnings (478) (4,217)

-----------------------------------------------------------------------------------------------------------------------------------
Earnings from equity method
investees $ 10,465 $ 14,616 $ 4,762 $ 3,412 $ 9,015
===================================================================================================================================

128. We note that you have classified the distribution of shares and options
as a non-cash investing and financing activity. Please tell us more
about these distributions and their related accounting in your
financial statements.

The Company respectfully informs the Staff that distributions
of shares and options represent non-cash distributions to the
principals of shares and options held by the Company in Newcastle and
Newcastle Investment Holdings LLC ("NIH").

The distributions to the principals during the years ended
December 31, 2005 and 2004, and the nine months ended September 30,
2005, were made pro rata to the principals based upon their respective
ownership percentages in the Company. The Company accounted for such
distributions by crediting its investments in Newcastle and NIH for the
recorded book value of the shares and options distributed and by
recording a charge to members' equity for the same amount.

This accounting treatment is based upon the guidance in
paragraph 23 of APB 29, Accounting for Nonmonetary Transactions ("APB
29"), which states, "Accounting for the distribution of nonmonetary
assets to owners of an enterprise in a spin-off...should be based on
the recorded amount... of the nonmonetary assets distributed. A pro
rata distribution to owners of an enterprise of shares of a subsidiary
or other investee company that has been or is being consolidated or
that has been or is being accounted for under the equity method is to
be considered to be equivalent of a spin-off."

The distributions during the year ended December 31, 2003,
were made only to one former principal of the Company in connection
with his existing partnership and were not on a pro rata basis. The
Company accounted for such distributions at fair value by recording a
credit to its investments in Newcastle and NIH for the recorded book
value of the shares and options distributed, a debit to members' equity
for the fair value of the shares and options distributed, and a credit
to earnings to recognize a gain for the appreciation in value of the
securities up to the dates of the distributions.

Fortress Investment Group LLC
December 21, 2006
Page 60 of 70

The accounting treatment for the 2003 distributions is also
based upon the guidance in paragraph 23 of APB 29, which states, "Other
nonreciprocal transfers of nonmonetary assets to owners should be
accounted for at fair value if the fair value of the nonmonetary asset
distributed is objectively measureable and would be clearly realizable
to the distributing entity in an outright sale at or near the time of
distribution."

1. Organization and Basis of Presentation, page F-7
---------------------------------------------------

129. We note Fortress Operating Group is a combination of eight entities
under common control and management. Please tell us whether there are
any other entities that are also under the same common control and
management as these eight entities. For each entity being excluded,
please provide us with a brief description of this entity, including
the operating results. If there are any affiliated Fortress entities
that are not include in the Fortress Operating Group, explain to us
what criteria was used to include, or exclude any particular entity.

The Company respectfully informs the Staff that as noted in
its response to Comment No. 12 above, all of the businesses operated as
a historical matter by Fortress are held by the Fortress Operating
Group entities. The principals do not control, other than via the
Fortress Operating Group entities, any investment management or
investment-related business. The Company respectfully informs the Staff
that each of the principals maintains, as might be expected, an
investment portfolio, but these are, in each case, personal investment
portfolios, not businesses that are held in common by the principals,
and none of the principals owns personally any interest in any third
party alternative asset manager. In addition, the principals do not
hold in any personal (or family trust or similar) capacity any portion
of the carried interest in, or any right to any portion of the
management fees paid by, any fund managed by Fortress. A central
premise of the principals' decision to enable public investors to
participate in Fortress's business - by creating a public company that
would, through the intermediate holding companies, become a partner in
the Fortress Operating Group - is that the entirety of their business
interests should be owned by investment management business in which
the public is, indirectly, investing.

130. Given your statement on page 1 that "Fortress Operating Group will
continue to own all of the businesses created by Fortress since 1998,"
we assume that your presentation of these combined financial statements
includes all of the historical costs of each of these entities'
businesses, including those they may have been incurred by affiliates
on the entities' behalf. Refer to SAB Topic 1:B.l for additional
guidance. If any of the costs of these entities were allocated, please
disclose the method by which such costs were allocated, including all
of the other disclosures required by Question 2 of SAB Topic 1:B.1.

Fortress Investment Group LLC
December 21, 2006
Page 61 of 70

The Company respectfully informs the Staff that all of the
historical costs and expenses of all of the combined businesses created
by us since inception have been included in the Company's combined
financial statements. Therefore, none of the costs or expenses included
in the combined financial statements resulted from allocations.

2. Summary of Significant Accounting Policies, page F-7
-------------------------------------------------------

Basis of Accounting, page F-7
-----------------------------

131. Please provide us with your significance tests for each period
presented for each entity that is accounted for under equity method of
accounting in determining whether separate financial statements are
required in accordance with Rule 3-09 of Regulation S-X.

The Company respectfully informs the Staff that the
significance tests for each period presented for each entity accounted
for under the equity method are presented below. All of the Company's
investees accounted for under the equity method are less than majority
held. All amounts have been presented in thousands.

Significance Thresholds under Rule 3-09 of Regulation S-X. The income
for each period tested was greater than the average for the previous
five periods. The materiality thresholds are as follows:

Company's Combined Total Assets: 20% Threshold: Company's Combined Pre-Tax Income: 20% Threshold:
-------------------------------- -------------- ---------------------------------- --------------

As of September 30, 2006 $18,497,040 $ 3,699,408 Pre-tax income for the nine months ended:
As of December 31, 2005 11,863,938 2,372,788 9/30/2006: $ 167,549 $ 33,510
As of December 31, 2004 5,796,733 1,159,347 9/30/2005: 42,142 8,428

Pre-tax income for the year ended:
12/31/2005: $202,301 40,460
12/31/2004: 117,838 23,568
12/31/2003: 41,766 8,353

INVESTMENT TEST: September 30, 2006 December 31, 2005 December 31, 2004
---------------- ------------------------- ------------------------- -------------------------
Equity method % of Equity method % of Equity method % of
Investment Assets Investment Assets Investment Assets
---------------- ------- ---------------- ------- ---------------- -------

Fortress Funds:
Newcastle Investment Holdings, LLC: $ 7,254 <0.1% $ 9,736 0.1% $ 3,699 0.1%
Newcastle Investment Corp.: 13,857 0.1% 12,979 0.1% 12,058 0.2%
Eurocastle Investment Ltd.: 12,072 0.1% 12,061 0.1% 14,650 0.3%

Other Equity Method Investees Combined:
CDO Vehicles and Managed Accounts: 3,292 <0.1% 2,825 <0.1% 1,818 <0.1%

---------------- ---------------- ----------------
Total: $ 36,475 $ 37,601 $ 32,225

Fortress Investment Group LLC
December 21, 2006
Page 62 of 70

Nine months ended September 30,
-----------------------------------------------------
2006 2005
------------------------- --------------------------
% of % of
Earnings Income Earnings Income
------------- ---------- ------------- -----------

Fortress Funds:
Newcastle Investment Holdings, LLC: $ 1,256 0.7% $ 5,562 13.2%
Newcastle Investment Corp.: 2,030 1.2% 1,775 4.2%
Eurocastle Investment Ltd.: (84) <0.1% 1,468 3.5%

CDO Vehicles:
Fortress Credit Opportunities Holdings I, LP: 87 0.1% 88 0.2%
Fortress Credit Opportunities II, LP: 77 <0.1% 94 0.2%
Fortress Credit Funding Holdings I, LP: 19 <0.1% 3 <0.1%
Fortress Credit Funding II, LP: 2 <0.1% 4 <0.1%
Fortress Credit Investments II, Ltd.: 9 <0.1%
Fortress Credit Investments IV Ltd.: 3 <0.1%

Managed Accounts:
DBN: 13 <0.1% 21 <0.1%

------------- -------------
Total: $ 3,412 $ 9,015

Year ended December 31,
--------------------------------------------------------------------------------
2005 2004 2003
-------------------------- -------------------------- -------------------------
% of % of % of
Earnings Income Earnings Income Earnings Income
-------------- ---------- -------------- ----------- ------------- ----------

Fortress Funds:
Newcastle Investment Holdings, LLC: $ 6,091 3.0% $ 8,448 7.2% $ 1,421 3.4%
Newcastle Investment Corp.: 2,419 1.2% 5,046 4.3% 3,303 7.9%
Eurocastle Investment Ltd.: 1,710 0.8% 900 0.8% (10) <0.1%

CDO Vehicles:
Fortress Credit Opportunities Holdings I, LP: 100 <0.1% 75 0.1% 19 <0.1%
Fortress Credit Opportunities II, LP: 107 0.1% 72 0.1% 19 <0.1%
Fortress Credit Funding Holdings I, LP: 4 <0.1%
Fortress Credit Funding II, LP: 6 <0.1%
Fortress Credit Investments II, Ltd.:
Fortress Credit Investments IV Ltd.:

Managed Accounts:
DBN: 28 <0.1% 75 0.1% 10 <0.1%

-------------- -------------- -------------
Total: $ 10,465 $ 14,616 $ 4,762

132. We note that you are consolidating four Feeder Funds that invest
through Master Funds, which are not consolidated. Please tell us how
you determined it was appropriate to consolidate these Feeder Funds
based on their pro-rata share of the related Master Funds, including
the authoritative literature that supports your accounting. Please also
tell us how you determined the associated Master Funds are not required
to be consolidated.

These four consolidated Feeder Funds follow the specialized
master-feeder accounting prescribed by the Investment Company Guide.
The Company has retained this specialized accounting in consolidation
in accordance with Emerging Issue Task Force 85-12, "Retention of
Specialized Accounting for Investments in Consolidation," ("EITF
85-12").

In accordance with the master-feeder accounting described in
the Investment Company Guide, a "feeder fund's statement of assets and
liabilities shows an investment in the master fund" (paragraph 5.35)
while the feeder fund's "statement of operations reports details of the
feeder fund's allocated share of net investment income from the master
fund... (and) also reports separately the feeder's allocated share of
the master fund's realized and unrealized gains and losses" (paragraph
5.38).

This effectively results in the feeder having a fair value
equity method investment in the master for balance sheet purposes, but
a pro rata consolidation of the master fund's income statement. The
Company has retained this specialized accounting in consolidation, and
therefore, has reflected its interests in the master funds in this
manner.

Incentive Income, page F-9
--------------------------

133. We note your statement that deferred incentive income liability
represents distributed and undistributed incentive income from
consolidated Fortress Funds and also distributions of incentive income
from the unconsolidated Fortress

Fortress Investment Group LLC
December 21, 2006
Page 63 of 70

Funds. Tell us why it is necessary to recognize a deferred incentive
income liability for undistributed incentive income. Differentiate the
deferred incentive income liability related to your consolidated versus
your unconsolidated funds. In this regard, we note that the amount of
incentive income being eliminated on the combined income statement is
the increase in the deferred incentive income liability. Furthermore,
your disclosure on page F-17 indicates that deferred incentive income
relates only to consolidated private equity funds. Please clarify your
disclosure.

The Company respectfully refers the Staff to our response to
Comment No. 125 regarding the need to recognize a deferred incentive
income liability for undistributed incentive income of a consolidated
fund.

For all periods presented, the deferred incentive income
liability for undistributed amounts relates only to consolidated
Fortress Funds. This can be determined from the tables on pages F-19
and F-61. Upon deconsolidation, this accounting convention will no
longer be required. We have revised our disclosure on page F-10 to
clarify this.

134. We note that you recognize incentive income from certain of your
Fortress Funds in the fourth quarter. Please disclose the amount of
incentive income from these certain funds that was recognized during
the fourth quarter for each period presented. In addition, in your
September 30, 2006 interim financial statements, please disclose that
incentive income has not been recognized for certain Fortress Funds, as
the incentive income is based on achieving annual performance criteria,
and state the amount of incentive income that you would have recognized
if the incentive income was not contingent on the results of the fourth
quarter.

The disclosures on pages F-11 and F-61 have been revised in
response to the Staff's comment.

Security Transactions, Interest and Dividend Income and Other Income, page F-10
-------------------------------------------------------------------------------

135. Please include your policy for recognizing "day one" gains,
distinguishing between securities that are based on market value versus
other fair value techniques. Specifically address whether you defer
recognition of "day one" gains and if so, how and when such amounts are
released into income. Also, if your policy is to defer such gains,
clarify to what extent such deferral impacts the recognition of
compensation expense.

The disclosure on page F-11 has been revised in response to
the Staff's comment. The Company respectfully informs the Staff that it
follows the guidance in footnote 3 of Emerging Issues Task Force (EITF)
Issue 02-3, Issues Involved in Accounting for Derivative Contracts Held
for Trading Purposes and Contracts Involved in Energy Trading and Risk
Management Activities, with

Fortress Investment Group LLC
December 21, 2006
Page 64 of 70

respect to recognizing "day one" gains. It is the Company's policy to
not recognize an unrealized gain or loss at inception of a financial
instrument unless the fair value of that instrument is obtained from a
quoted market price in an active market or is otherwise evidenced by
comparison to other observable current market transactions or based on
a valuation technique incorporating observable market data. To date,
the Company has not recognized any "day one" gains.

Profit Sharing Arrangements, page F-14
--------------------------------------

136. We note that you recognize compensation expense for profit sharing
interests when the amounts are probable and reasonably estimable, which
is generally when the incentive income becomes payable from the funds.
Please tell us how you determined the timing of your recognition of
compensation expense is appropriate, including the authoritative
literature that supports your accounting.

The disclosure on page F-15 has been revised in response to
the Staff's comments to remove the clause noted in the comment. The
clause related solely to cumulative earnings based awards and therefore
was inappropriate as a general disclosure.

The Company respectfully informs the staff that it accounts
for its profit sharing arrangements under the SFAS 5 "Accounting for
Contingencies" model. The Company is eligible to receive incentive
income from certain funds which it manages based upon their cumulative
performance over the life of the funds. In order to create an alignment
of interests, the Company has established profit sharing arrangements
which provide for the employees to receive a share of such incentive
income in the event that the funds achieve their performance targets.

The employees of the Company are eligible to receive profit
sharing payments based upon their share of the incentive income
ultimately earned by the Company from the fund. Pursuant to the
respective agreements with the funds, the Company is eligible to
receive interim payments under the incentive fee allocation provisions,
prior to the final resolution or determination of the funds' ultimate
performance, based upon the total amount of cumulative realized income
of the fund through an interim period over the performance target. Such
interim payments or distributions to the Company are however subject to
clawback (or repayment to the fund) if the performance hurdles are not
met by the fund as measured from inception to the date of dissolution.
As noted in the Company's policy note on page F-10, the Company defers
all income recognition on incentive income allocations until all
performance contingencies are finally resolved. These interim cash
distributions from the funds are made to the Company, the Company in
turn makes profit sharing payments to its employees. The interim profit
sharing payments to employees are similarly subject to clawback (or
repayment to the

Fortress Investment Group LLC
December 21, 2006
Page 65 of 70

Company) in the event the Company's incentive income distributions must
be repaid to the respective fund. The Company holds back a certain
percentage (generally 30%) of the interim profit sharing payments made
to employees to partially collateralize the potential need for such a
clawback from an employee.

The Company records an expense when it becomes both probable
that an obligation has been incurred and such obligation can be
reasonably estimated. Management considers many factors in its
determination of the timing and amount of an expense accrual including
their historical experience with a fund, the level of unrealized gains
and losses of the particular fund, and remaining fund life. Given the
significant unrealized appreciation within most of these funds to date,
which would have to be lost before a clawback event would occur, the
Company has typically accrued a liability for the full amount of profit
sharing to employees upon declaration of an interim incentive income
distribution to the Company. The Company analyzes its profit sharing
accrual position related to the performance of the underlying funds at
least quarterly.

In light of this expense accrual policy, employee profit
sharing expense is generally recorded prior to any recognition of the
related incentive fee income in the Company's income statement.

3. Management Agreements and the Fortress Funds, page F-16
----------------------------------------------------------

137. With regard to the private equity funds table on page F-16, please
include a footnote to disclose the definition of "Total Capital
Commitments." In footnote (E), please include the definition of
"Incentive Income Threshold Return."

The Company has revised its disclosure in the financial
statements to provide the information.

138. We note that you have deferred receipt of your management fees and
incentive income for your liquid hedge funds and hybrid hedge funds for
each of the periods presented. Please include disclosure within the
liquidity section of MD&A to state the amount of management fees and
incentive income that has been deferred and when you expect to receive
the cash payment.

The disclosure on pages 119-120 has been revised in response
to the Staff's comment.

Fortress Investment Group LLC
December 21, 2006
Page 66 of 70

9. Commitments and Contingencies, page F-38
-------------------------------------------

Litigation, page F-39
---------------------

139. For each of the three items disclosed, please state whether these items
are expected to have a material impact on liquidity.

The disclosure on page F-43 has been revised in response to
the Staff's comment.

10. Segment Reporting, page F-41
--------------------------------

140. To help us better understand how your CODM manages the business, please
provide us with copies of all the different types of reports reviewed
by your CODM on a regular basis.

Copies of recent reports reviewed by the Company's CODM
(collectively, the "CODM package") have been submitted together with
the Registration Statement. The CODM package includes a weekly overview
by business segment including public equities' surplus, distributable
earnings statement for the current year by quarter, Hedge Fund
performance by month, a detailed balance sheet, employee statistics and
market comparables.

The CODM has been defined by the Company as the five
principals of the Company. The CODM package is reviewed on a weekly
basis by operating business, to effectively allocate resources to and
assess the performance of the segments of the Company.

The performance of the Company is included in the weekly
financial performance report ("Weekly Overview") in the CODM package
and is used to make the operating decisions for the Company based on
financial data that is presented without the consolidation of any
Fortress Funds. Distributable earnings is the primary measure used by
the CODM in making operating decisions and assessing the performance of
each of the Company's segments.

Distributable earnings includes two key revenue line items for
each segment: management and incentive (or promote) revenues.

(1) Management fees

Management fees are accrued based on the size of each fund, which could
be its net asset value ("NAV"), capital commitments, invested equity or
gross equity, each as defined in the applicable management agreement.
Management fees recorded in accordance with GAAP in connection with the
receipt of options from the Castles is not included within
distributable earnings in the Weekly Overview until the shares received
as a result of the exercise of such options are sold. When sold, such
realized gain is reflected as incentive income in our segment
presentation.

Fortress Investment Group LLC
December 21, 2006
Page 67 of 70

(2) Incentive (or promote) income

Incentive income is based in most cases on a percentage of profits
earned by the funds subject to the achievement of performance criteria.
The calculation of incentive income varies by reportable segment and is
discussed below:

o Private Equity Funds: Incentive income distributed from the
funds relates to realization events of each fund during the
period and are subject to contingent repayment (or "clawback")
based on the funds' future performance. The Company without
the consolidation of any Fortress Funds recognizes incentive
income received in cash as deferred incentive income liability
under Method 1 of EITF Topic D-96 for GAAP purposes. An
adjustment is made to GAAP incentive income to recognize
realization events as income, subject to an applicable reserve
for potential future clawback if the likelihood of clawback is
deemed greater than remote, for the Weekly Overview. No such
reserve has been required to date.

o Hedge Funds (Both Liquid and Hybrid): Incentive income is
based on the change in NAV due to net income of each fund
during each period. Incentive income is paid at least annually
by the funds. The Company recognizes the incentive income
which would be due at any point in time assuming a
hypothetical liquidation of the respective fund.

o Castles: Incentive income is based on a percentage of their
Funds from Operations ("FFO"), in excess of certain hurdles,
during each period, provided the accumulated FFO since
inception of the Castles is above such hurdles. Payments are
made at least annually. The Company receives options from the
Publicly Traded Alternative Investment Vehicles (or Castles)
as compensation each time the Company assists in a public
offering of the Castles' equity. The options give further
incentive to the Company, as the investment manager of the
Castles, to generate a higher market price of the vehicle's
shares and help to align its interests with the public
investors of the Castles. For the purposes of the CODM
package, the options will generate incentive income upon the
sale of the shares received pursuant to their exercise.

Distributable earnings also includes one other revenue line
item: net investment income. Net investment income is based on the
investment returns from each fund in which the Company has a principal
investment. Net investment income is determined in parallel to the
incentive income strategy for each segment as listed below:

o Private Equity Funds: Realization events of each fund
during the period.

o Hedge Funds (Both Liquid and Hybrid): Change in NAV due
to net income of each fund during each period.

o Castles: Dividends received during the period.

Fortress Investment Group LLC
December 21, 2006
Page 68 of 70

Distributable earnings and total assets as presented in the
Weekly Overview for historical periods can be agreed to the segment
reporting footnote of the Registration Statement as disclosed in pages
F-47 to F-49, F-51 and F-69 to F-70.

The Weekly Overview lists the following four primary
reportable segments as disclosed in pages F-47 to F-49, F-51 and F-69
to F-70 from which the Company receives management fees and incentive
income.

o Private Equity - Private Equity Funds

o Special Ops - Hybrid Hedge Funds

o Liquid Markets - Liquid Hedge Funds

o Castles - Castles

o Unallocated - Unallocated

The Private Equity, Hybrid Hedge Funds, Liquid Markets and
Castle businesses are described in the Registration Statement. The
Unallocated section in the CODM package is comprised of the Company's
expenses such as interest expense and income taxes, before
consolidation of any Fortress Funds.

The performance of the funds will generally be a function of
the investment strategy of the fund and of the macroeconomic
environment. The CODM manages these investment companies according to
prescribed investment strategies, which may consist of investing in
real estate, private securities, public securities, commodities, debt,
derivatives, currency, or derivatives of these investments. Based on
the macro economic environment, each of these strategies will result in
different returns based on risk.

Fortress Operating Group (Limited Liability Companies) for the Fiscal Quarter
-----------------------------------------------------------------------------
Ended June 30, 2006, page F-48
------------------------------

Combined Balance Sheet, page F-48
---------------------------------

141. We note you plan to make distributions to your principals that are not
reflected in this balance sheet and will be material relative to you
reported equity. As such, please provide a pro forma balance sheet
reflecting the accrual (but not giving effect to the offering proceeds)
along side the historical balance sheet. See SAB Topic 1.B.3.

The Company respectfully acknowledges the Staff's comment and
has included a pro forma balance sheet alongside the September 30, 2006
historical balance sheet. When the Company has determined the amount of
our distributions to be made to our principals, we will include the pro
forma amounts in a future pre-effective amendment to the Registration
Statement.

Fortress Investment Group LLC
December 21, 2006
Page 69 of 70

Exhibits
--------

142. Please file all the exhibits required by Item 601 of Regulation S-K,
including:

o the form of indemnification agreement,

o credit agreements,

o partnership, operating and distribution agreements and other
organizational documents relating to the intermediate holding
companies, the operating group, operating entities and principal
holdings, and

o each fund's and Castle's management agreement.

* * * * *

Please contact the undersigned at (212) 735-3050 should you require
further information or have any questions.

Very truly yours,

/s/ Joseph A. Coco

Joseph A. Coco

cc: Brigitte Lippmann, Esq.
Ms. Tracey Houser
Ms. Jeanne Baker
Securities and Exchange Commission

Alan Chesick, Esq.
General Counsel
Fortress Investment Group LLC
1345 Avenue of the Americas
46th Floor
New York, NY 10105

Fortress Investment Group LLC
December 21, 2006
Page 70 of 70

Edward F. Petrosky, Esq.
J. Gerard Cummins, Esq.
Sidley Austin LLP
787 Seventh Avenue
New York, NY 10019