Pushing back against regulation

Thu Jun 1, 2006

Forget those Big Brother fears; the SEC is making nice

When U.S. Securities and Exchange Commission examiners come knocking on the doors of hedge funds, some advisors might be stunned by the information requested. In addition to being asked to admit if they've broken the law, advisors are also being asked to let the SEC know if they have considered doing anything even slightly dodgy.

"Provide a written summary of any proposed business transaction, scheme, deal, side deal, arrangement, or similar matter that, during the inspection period, Registrant was asked to consider but rejected because the proposal was deemed inadvisable, inappropriate, unethical or possibly illegal," the request for information states.

"That definitely goes too far," says Jack Gaine, president of the Managed Funds Association, the hedge fund lobbying group, which is trying to get the SEC to strike that demand.

There's no doubt about it: Such tactics by the SEC...

ISSN: 2151-1845 / CDC10004H

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