•  
• Tweet
•  
•        Print
•  
•         Track Keywords
•  
• 

From Kirsten Bischoff, Opalesque New York:

Hedge fund managers did not express surprise at the extent of the proposed legislation the Obama administration announced Wednesday that it would aim at the industry. But, even as managers have been expecting regulation in some form since the President’s Working Group on Hedge Funds first convened to look into regulation in early 2008, they voiced their disappointment today at what they saw as the wide scope of the proposal.

Mitch Nichter, partner in the Investment Management Practice at international law firm Paul Hastings said his hedge fund clients had expressed “resigned dismay, coupled with significant concern over the almost plenary authority the proposed legislation would give the SEC to regulate private fund managers of all types – hedge fund, private equity, venture and real estate fund managers.”

Nichter said managers are most concerned with the possibility of heavy-handed regulations that would stifle private fund managers and slow capital formation just when capital formation is needed. “The direction and guidance provided to the SEC in the proposal is insufficient and, in my opinion, will likely result in excessive regulation, increased costs and reduced investor returns.”

Andrew Donohue, who heads the SEC Division of Investment Management, told members of Congress today the funds could be made subject to the Investment Company Act, which regulates m......................

To view our full article Click here