WEST PALM BEACH, FL (HEDGECO.NET) – Hedge fund industry participants, including managers and lawyers have urged the US Securities and Exchange Commission to find other alternatives to its currentproposals to regulate the US hedge fund industry. The SEC proposal mandates registration for US hedge funds overseeing over $25 million in investor assets.
The Managed Funds Association released a statement in which the industry trade group said, “In light of the division within the Commission, the lack of support by the President’s Working Group on Financial Markets, and the fact that no public policy cases have been made to support the proposed rule, the SEC should at the very least consider these alternatives�.
The group is asking the SEC to consider alternatives ranging from making it more difficult to invest in hedge fund investment portfolios, to allowing hedge fund investors to examine their audited financial statements.
The SEC Chairman William Donaldson has been aggressively pursuing hedge fund regulation initiatives, and he joined two democratic members of the SEC committee to pass the initial vote. The second vote on the matter is still pending.
According to news reports by Dow Jones, there has been little support for the SEC hedge fund regulation proposals, judging from the comment letters forwarded to the government body. A survey conducted by Managed Funds Association shows that about 73% of the 125 letters sent to the SEC opposed the hedge-fund plan. Only 27 % of the letters received were in support of the plan. Supporters of the proposals were mostly members of the US Investment Company Institute, the leading trade group for mutual funds, a key hedge-fund competitor.
Final votes by the SEC on the matter may be issued in late October; such judgment is likely to be challenged in the courts if it goes against the collective opinions of the US hedge fund industry participants.
Paul Oranika
Editor-in-Chief
HedgeCo.Net
Email: Editor@hedgeco.net
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