Lawmakers look to home in on conflicts at consultants who cater to both pensions and hedge funds
By Eric Baum
A federal report scheduled for release in June could turn up the heat on festering controversies involving hedge funds, pension assets and the consultants that marry the two. The report is expected to direct a pointed jab at conflicts of interest at consultancies that not only advise pension funds but also steer them into funds of funds they run. Some consultants even have brokerage arms that trade for hedge fund clients.
"Are consultants recommending certain firms because they have a remunerative interest?" asks Mark Bayer, an aide to Congressman Edward Markey, a Democrat from Massachusetts who, along with Rep. George Miller (D-Calif.), requested the forthcoming General Accounting Office report. "You end up with recommendations that are in the best interest of a consultant, but they're not necessarily in the best...