SEC Proposes Hedge Fund Registration

Nov 22 2010 | 9:34am ET

The Securities and Exchange Commission will require hedge fund and other private fund managers to provide a whole host of new information under a new rule proposed last week.

The SEC proposal will give shape to some parts of the recently-enacted Dodd-Frank financial regulation reform law, including a new requirement that hedge funds register with the regulator. Under the new rule—which faces a 45-day comment period following the Commission's official proposal of it on Friday—most of the new regulatory burden will fall on hedge funds with assets of at least $150 million.

The agency proposed doing away with the private adviser exemption, requiring all such funds—with the exception of venture capital funds and most family offices—to register with it if they are large enough. Hedge funds will be required to disclose basic information, including assets under management and the types of investors in the fund, as well as its auditors, prime brokers, custodians, administrators and marketers.

Advisers themselves will have to provide more information as well, including about their employees, potential conflicts of interest such as soft-dollar deals, and advisory activities. Such firms may have to register even if they manage less than $150 million or exclusively venture capital funds.

The new rule also changes the SEC's pay-to-play regulations in the wake of a scandal at the New York State Common Retirement Fund.

The SEC voted 4-1 to propose the rules, with only Republican Commissioner Kathleen Casey dissenting over the collapsing of "a carefully wrought distinction between registered advisers and exempt advisers." But even Casey was effusive about the venture capital exemption.


In Depth

Q&A: Neil Azous Talks Global Macro Investing

Nov 24 2014 | 12:41pm ET

Neil Azous is the founder and managing member of Rareview Macro, an advisory firm...

Lifestyle

Scene Last Night: Clinton, Schwarzman, Corzine, Neidich, Diamond

Nov 25 2014 | 5:52pm ET

Steve Schwarzman had a granddaughter yesterday morning. Last night he sat one table...

Guest Contributor

Why The Big Money Is Going To Europe

Nov 14 2014 | 6:03am ET

Peer-to-peer lending was invented with the individual investor in mind. But despite...

 

Sponsored Content

    For Hedge Funds, Mastering Data Is Key To Success

    Nov 4 2014 | 9:45am ET

    Data management is important to every business, but for hedge funds, it is critical. FINalternatives recently asked Peter Sanchez, CEO of Northern Trust Hedge Fund Services, how fund managers can deal with the demands of managing data while at the same time remain transparent and abide by operational best practices. Read more…

Editor's Note

    Guidelines for Guest Articles

    Oct 22 2014 | 9:46am ET

    We are always looking for guest articles from hedge fund managers and buy-side firms.

    If you are interested in submitting a contributed piece for possible publication on FINalternatives, please take a look at the specs. Read more…

 

Futures Magazine

November 2014 Cover

Building a better market

Reg NMS created a huge bifurcation in equity markets and while much of what has followed has been positive, in terms of lower fees and greater liquidity, many traders would like to see the market come...

The Alpha Pages

TAP July/August 2014 Cover

The Alpha Pages Interview: Senator Rand Paul

Senator Paul sat down in the debut series of the Alpha Pages Interview to discuss the broken tax code, regulation surrounding Bitcoin, and his plans for the 2016 Presidential election.