obama moves to regulate

Discussion in 'Wall St. News' started by marketsurfer, Jun 23, 2009.

  1. OBAMA ADMINISTRATION CALLs FOR INCREASED REGULATION of hedge fund & private equity advisors


    NEW YORK, NY – (June 23, 2009) -- Kinetic Partners, a leading regulatory consultancy to the hedge fund industry, predicts that President Barack Obama’s proposed changes to the U.S. financial regulatory system are a foregone conclusion. Not only will Obama’s edict to the U.S. Congress result in the inevitable requirement for hedge fund and private equity advisors to register with the Securities and Exchange Commission, but the key components of the proposed regulation comprise solid best practices for hedge funds and private equity firms. Kinetic Partners contends that many advisors will need to step up their act immediately in order to be prepared to prove their “culture of compliance.”

    Should the regulations pass as outlined in the president’s 88-page report to Congress issued earlier this month, the majority of hedge fund, private equity, venture capital and advisors to other pooled investment vehicles, will now be required to register with the SEC and comply with a new, stricter set of rules related to disclosure, infrastructure, compliance, reporting, policies and procedures.

    “Investment advisors will now be required to develop and navigate best practices, conduct all investment activities within a stricter regulatory framework, and follow-through on detailed documentation in all required areas,” said Neil Morris, a partner in Kinetic Partners’ New York office. “As opposed to a one-time initiative, on-going testing and reviews will be compulsory, which represents a far-reaching change for the industry. Managers cannot simply put a new compliance manual on the shelf and continue in a business-as-usual manner.”

    Kinetic Partners believes that the majority of investment advisors are unprepared and will need to take a close look at specific areas such as their compliance manual, code of ethics, employee investment policies governing personal trading, employee checks and balances, annual employee training, annual self-assessment, documentation of entities, and SEC disclosures to current and potential investors, including Form ADV, Form ADV Part 11, and Schedule F. In addition, firms must appoint a chief compliance officer. These areas are among the greatest challenges to most U.S. fund advisors as they traditionally have not been emphasized, according to Morris.

    Other possible effects of the current legislative proposals and the registration requirements include: disclosure of leverage and other portfolio criteria at the SEC’s discretion; anti-money-laundering (AML) policies; SEC examinations; new custody rule requirements; retention of records; and regulation of all over-the counter (OTC) derivatives.

    For further information, please contact:

    Neil Morris/Chris Lombardy

    Kinetic Partners LLP (New York)
  2. DOW to 20,000!