No need to fear SEC clean-up

Sun Feb 1, 2004



Talk to a roomful of hedge fund managers about what will come out of Washington next and many will express genuine alarm. The perception is that Congress, in its zeal to crack down on mutual fund abuses, will crack down hard on hedge funds as well. In the wake of the market-timing scandal, some fear that Congress will force mutual funds to divest their hedge funds, or even worse.

Much of this concern has been massively exaggerated. Here's a reality check: the mutual fund scandal will probably leave hedge funds largely unscathed. Congress has rightly targeted mutual funds. Their clear priority is to protect the nest eggs of middle-class Americans, not the fat cats who own hedge funds. Congress is currently focused on just one very limited provision that falls at the intersection of the two industries that could well be enacted into law. This provision is eminently sensible and...

ISSN: 2151-1845 / CDC10004H

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