BRUSSELS (Reuters)- The current system of indirect oversight of hedge funds is appropriate and the sector is not the culprit behind the current market crisis, a senior market regulator said on Tuesday.
"Hedge funds are neither catalysts or drivers of current market turmoil," Dan Waters, director of retail policy at the Financial Services Authority, told the European Parliament.
"The indirect approach of supervision to hedge funds is the appropriate and cost effective one," Waters said.
Hedge funds are currently supervised indirectly through the prime brokers, typically big investment banks, that provide them with capital.
