Hedge funds will again have to register with the Securities and Exchange Commission, a top Congressional leader said yesterday.
Rep. Barney Frank (D-Mass.), the chairman of the House Financial Services Committee, said he will include the registration provision in his financial regulation reform bill, which he hopes to have passed by the end of the year. If it is, the bill would overturn a 2006 federal court decision that threw out the SEC’s hedge fund then-controversial registration requirement.
“We will give them explicitly that authority,” Frank told the Reuters Global Financial Regulation Summit in Washington.
At the time the SEC enacted the registration rule, the hedge fund industry moaned about its invasiveness and one, Bulldog Investors’ Phil Goldstein, led a successful legal battle to have it overturned. Now, registration is seen as more-or-less inevitable, and much preferable to the more stringent restrictions being discussed in Washington and in Europe. The U.S. Senate, for one, is already considering a bill that would give the SEC much broader regulatory powers over hedge funds than mere registration.