Washington, DC -
November 9, 2009 - The Hedge Fund Association, HFA, today announced progress on
its "Speak Up" campaign, which seeks to ensure that regulation of the hedge
fund industry meets government concerns without imposing over-reaching, broad measures
that makes it costly for small funds to operate, and could impede industry
growth and job creation.
HFA President, David
Friedland, said that the HFA was not opposed to additional regulation and
registration or reporting requirements. "The
HFA is open to working with Congress to ensure that any regulation is cost
effective and achieves objectives that both Congress and the industry need." Mr. Friedland further noted that all hedge
funds are already subject to certain rules and regulations, including SEC
anti-fraud provisions.
Mr. Friedland said,
however, that "proposals from Congress to regulate funds with assets under
management of over $30 million could result in smaller hedge funds, which form
the vast majority of firms, to close their doors, causing a devastating impact
on an industry already suffering from the effects of the financial downturn. This will result in a loss of jobs not only
within those hedge fund firms, but also at the administrators, law firms,
auditors, banks and brokers who rely so heavily on smaller/startup funds for
much of their business."
The Hedge Fund
Association's "Speak Up" campaign was launched with the aim of educating
lawmakers and the media of the burden that new regulations would place on smaller
hedge funds. "Some form of registration
requirement and reporting requirement for firms with more than $250 million would
seem to make the most sense" Mr. Friedland stated. "Typically firms with more than $250 million
have a much larger internal staff than firms managing smaller funds. The larger firms can take on the burden of
increased registration/reporting requirements and an internal compliance
officer in a much more economical fashion."
As a result of this
campaign, recent legislation being proposed by Congress would raise the
registration requirement from assets under management of $30 million to $150
million.
"It's not as high as
we would like, but we appreciate that lawmakers have listened to the concerns
of the HFA and taken steps that would protect the small managers from the
burden of excessive regulation."
|
