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Wednesday, May 16, 2007 12:18:21 PM
Grassley renews push for hedge fund rules
Charles Grassley: $1.2 trillion industry lacks transparency.
By Bloomberg News | May 16, 2007
WASHINGTON -- US Senator Charles Grassley proposed legislation that would subject hedge funds to stricter oversight and routine inspections, reinstating rules struck down by a federal court last year.
The measure would require hedge fund managers with at least 15 investors and more than $50 million in assets to register with the Securities and Exchange Commission. Grassley, an Iowa Republican, said the measure will improve transparency of an industry whose assets under management exceed $1.2 trillion.
The measure clarifies that the SEC "has the authority to require hedge funds to register, so the government knows who they are and what they're doing," Grassley said in prepared remarks yesterday. "Hedge funds are operated by advisers who manage billions of dollars for groups of wealthy investors in total secrecy."
Grassley, citing the collapse of Amaranth Advisers LLC in September, said he's concerned that increasing investments in hedge funds by pension funds could jeopardize American's retirement savings. Amaranth lost $6.6 billion on failed bets on gas prices.
Grassley's stance contradicts President Bush's Treasury Department, which has said no new rules are needed to rein in hedge funds.
It's unclear whether Grassley, the top Republican on the Senate Finance Committee, will be able to move his measure. He failed in March to force hedge fund registration by attaching an amendment to a homeland security appropriations measure.
Any legislation regulating hedge funds would probably go through the Senate Banking Committee. That panel's chairman, Connecticut Democrat Christopher Dodd, has described hedge funds as "a tremendous wealth-creation vehicle."
Grassley's bill would reinstate SEC rules rejected in June by a federal appeals court in Washington. The SEC wanted hedge funds to report their size, number of employees, and undergo examinations by agency staff.
http://www.boston.com/business/globe/articles/2007/05/16/grassley_renews_push_for_hedge_fund_rules/
Charles Grassley: $1.2 trillion industry lacks transparency.
By Bloomberg News | May 16, 2007
WASHINGTON -- US Senator Charles Grassley proposed legislation that would subject hedge funds to stricter oversight and routine inspections, reinstating rules struck down by a federal court last year.
The measure would require hedge fund managers with at least 15 investors and more than $50 million in assets to register with the Securities and Exchange Commission. Grassley, an Iowa Republican, said the measure will improve transparency of an industry whose assets under management exceed $1.2 trillion.
The measure clarifies that the SEC "has the authority to require hedge funds to register, so the government knows who they are and what they're doing," Grassley said in prepared remarks yesterday. "Hedge funds are operated by advisers who manage billions of dollars for groups of wealthy investors in total secrecy."
Grassley, citing the collapse of Amaranth Advisers LLC in September, said he's concerned that increasing investments in hedge funds by pension funds could jeopardize American's retirement savings. Amaranth lost $6.6 billion on failed bets on gas prices.
Grassley's stance contradicts President Bush's Treasury Department, which has said no new rules are needed to rein in hedge funds.
It's unclear whether Grassley, the top Republican on the Senate Finance Committee, will be able to move his measure. He failed in March to force hedge fund registration by attaching an amendment to a homeland security appropriations measure.
Any legislation regulating hedge funds would probably go through the Senate Banking Committee. That panel's chairman, Connecticut Democrat Christopher Dodd, has described hedge funds as "a tremendous wealth-creation vehicle."
Grassley's bill would reinstate SEC rules rejected in June by a federal appeals court in Washington. The SEC wanted hedge funds to report their size, number of employees, and undergo examinations by agency staff.
http://www.boston.com/business/globe/articles/2007/05/16/grassley_renews_push_for_hedge_fund_rules/
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