Saturday, 22 October 2016
Last updated 1 day ago
Jul 10 2007 | 1:46pm ET
It’s been a year since Bulldog Investors’ Phillip Goldstein won his battle with the Securities and Exchange Commission over its hedge fund registration requirement, and, the SEC’s hopes notwithstanding, hedge funds are voting with their feet. About 500 fewer hedge funds are registered with the regulator today than were one year ago—a 21% decline. The Commission had expressed hope at the time of the Goldstein decision that hedge funds would choose to remain registered even though the requirement had been struck down.
SEC spokesman John Nestor said there are 1,977 hedge funds currently registered with the agency. Last year, the figure was roughly 2,500.
In 2004, then-SEC Chairman William Donaldson pushed the requirement through the commission with the support of its two Democratic members in the face of the virulent opposition of his two fellow Republicans. Last June, the U.S. Court of Appeals in Washington, D.C., rejected the move, saying the SEC had overstepped its authority. Efforts in Congress to specifically empower the SEC to register hedge funds have thus far failed to win enough support to become law.