BOSTON, Oct 3 (Reuters) – Hundreds of U.S. hedge funds may slip through the crack when they register with regulators, new research shows, causing a humiliating if not harmful situation as authorities begin to scrutinize the industry more closely.
Life will change for thousands of loosely regulated hedge funds in February, when they must follow a new rule designed to reduce fraud in the hugely popular and often secretive $1 trillion industry.
Funds that manage $30 million or more for 15 or more clients must register with the Securities and Exchange Commission and let the agency’s inspectors review the hedge fund’s books at any time.
