Requiem for another attempt at hedge fund regulation
May 12th, 2008 | Filed under: Hedge Fund Regulation
You have to give regulators an “A” for effort. We’re not totally anti-regulation here at AllAboutAlpha.com. But we do find in curious how most, if not all, attempts to regulate hedge funds seem to have eventually come to a crashing halt.
The SEC set the example with its attempt to make hedge fund register back in 2006. Now the California Department of Corporations’ attempt to register hedge funds seems to have also met an untimely demise. HedgeWorld chronicles the whole sorry affair in detail…
As HedgeWorld points out, the proposed regulation would have required all funds not already voluntarily registered with the SEC to register with the Golden State. But to its surprise, the government of California found out that hedge funds would just leave the state to avoid the hassle (who could have known, really…).
In what appears to be a move to save face, California government officials said that “in light of the ongoing actions of federal regulators”, they would hold off on any further action on the regulatory front. Apparently, new regulations were “premature”. (Indeed, the time to drive hedge funds out of your state is later, not now).
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