Friday, 6 March 2015
Last updated 1 min ago
Mar 11 2011 | 1:21pm ET
Looking out of insider-trading and other market malfeasance, the Securities and Exchange Commission is taking a very hard look at the very best hedge funds.
The regulator's enforcement chief, Robert Khuzami, told a House of Representatives subcommittee that the SEC was focusing on the best-performing hedge funds as it combs the markets for illegal activity.
"We're now doing things like canvassing all hedge funds for aberrational performance," Khuzami said yesterday, looking for "anybody who is beating market indexes by 3% and doing it on a steady basis."
He added the SEC was also focusing on high-frequency trading and pension-liability analysis.
Khuzami made the announcement as part of a plea for more money for the SEC, which he says needs it as "we are more and more faced with the need to understand and identify wrongdoing in products and markets, transactions and practices that are increasingly complex or fast-paced or both," he said. "For those reasons our resource needs are most acute in the areas of IT, data access and analysis, human expertise and paraprofessional and administrative support."
Khuzami's statement came as SEC Chairman Mary Schapiro, on the other side of Capitol Hill, told senators the agency needs more than $260 million in budget increases to, in part, hire more than 100 staffers to monitor hedge funds.
House Republicans have said the agency's budget should be cut by $25 million.
Jan 23 2015 | 1:00pm ET
In our new section, FINtech Focus, we will profile one of these firms each week. While fintech is a broad category, we will be focusing on firms that specifically cater to the alternative investment industry. Read more…