WEST PALM BEACH, FL (www.hedgeco.net) – The Securities and Exchange team of lawyers vigorously defended the SEC�s decision to regulate the U.S. Hedge Fund industry. According to the lawyers, theclaims submitted by the New York hedge fund company challenging the new SEC laws does not come close in offering the courts reasons to set aside the new provisions.

In a legal briefing submitted by the SEC team of lawyers to the U.S. Court of Appeals on Wednesday, the lawyers said the SEC had the authority to adopt the new laws. The lawyers also defended the process through which the new laws were introduced, saying that the process was neither arbitrary nor capricious as asserted in the law suit.

The SEC lawyers asserted that mandatory hedge fund laws will not totally eliminate all the fraud within the hedge fund industry, but according to them, such laws will increase the chances that those committing such fraud will be caught.

The law suit challenging the new SEC new hedge fund laws were filled by the New York based hedge fund manager, Phillip Goldstein, President of Kimball & Winthrop Inc., and a portfolio manager for the Opportunity Partners LP, which manages over $83 million in assets. The law suit also said the SEC new hedge fund rules were not supported by the SEC staff report on hedge funds; the SEC lawyers maintained that such claims lacked merit because the SEC is not bound by its staff recommendations.

Goldstein will have the opportunity to respond to the briefs submitted by the SEC lawyers in about two weeks.

Paul Oranika
Editor-in-Chief
HedgeCo.Net
Email: Editor@hedgeco.net

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