Barney Frank and Goldman Sachs square off on Volcker rule wrangling
By Lawrence Delevingne
Tue Jun 8, 2010
Banks argue that clients want “skin in the game;” Volcker opposes watering down; Corzine weighs in
The fate of some of the largest hedge funds is being decided
in Washington right now. But while Goldman Sachs and other
banks are lobbying to keep capital in their hedge funds, Paul
Volcker and Barney Frank are pushing back.
Congress is scrambling to meld House and Senate versions of
financial reform legislation, and the fine print chosen by
lawmakers before the end of the month will have major
ramifications for hedge funds tied to large banks, most notably
the $50.4 billion in hedge fund assets managed by JPMorgan,
including $17.9 billion in its Highbridge Capital Management
subsidiary and $32.5 billion in its internal asset management
division. Goldman Sachs Asset Management (GSAM), which manages
$20.80 billion in hedge fund assets, would also be
Congress faces a thorny challenge in trying to come up with a
proposal that limits the risk to the taxpayer but also allows
ISSN: 2151-1845 / CDC10004H
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