Hedge Funds

Hedge funds still face cash solicitation disclosure requirements


A senior attorney for the U.S. Securities and Exchange Commission sent mixed signals to the hedge fund industry last month when he said that the agency's examination staff would no longer enforce its cash solicitation disclosure rules for agents raising money for hedge funds.

The comment, made in early June by Douglas Scheidt, the agency's Northeast chief investment management counsel, led to a slew of inquiries as hedge funds sought to clarify Scheidt's comments. Cash solicitation guidelines require agents engaged in raising money for funds managed by registered investment advisors to reveal such payments to potential investors.