Press Release: House Committee Holds Hearing on Congressman CapuanoÕs Hedge Fund Bill

Print Version-House Committee Holds Hearing on Congressman Capuano's Hedge Fund Bill

PRESS RELEASE

House Committee Holds Hearing on Congressman Capuano's Hedge Fund Bill

May 7, 2009

Today the House Committee on Financial Services held a hearing on hedge funds which included a discussion about H.R. 711: The Hedge Fund Advisor Registration Act, legislation introduced by Rep. Mike Capuano (D-MA) and Rep. Mike Castle (R-DE). The bill would close a loophole created in the Investment Advisors Act of 1940, which exempts hedge fund managers from registering with the Securities and Exchange Commission (SEC) if they have less than 15 clients. The Hedge Fund Advisor Registration Act requires all hedge fund managers to register with the SEC. This simple step would improve federal oversight of these investments.

"This measure would require all hedge fund managers to register with the SEC so that their actions on behalf of investors are transparent," said Rep. Capuano. "I have long advocated this simple step as a way to better understand how hedge fund managers are operating, and how they are investing the resources of their clients. In addition to providing us with basic census information on hedge funds, this measure can be used to detect and deter fraudulent practices and risky behavior before it's too late."

"Today's hearing is about identifying ways to provide simple and balanced hedge fund transparency. This type of regulation is not about the 95% who do the right thing; it's about being able to watch out for the 5% who might cross the line. While I am committed to hedge fund registration, I am open to discussion on how we get there, as long as disclosure and transparency are achieved," stated Rep. Mike Capuano.

Contact: Alison M. Mills (617) 621-6208