Thursday, June 18, 2009

Obama Administration's Proposed Financial Reforms Include Potential Registration of Investment Advisers

On June 17, the Obama Administration released its White Paper on Financial Regulatory Reform, which, among other, includes a call for investment advisers to register with the SEC. Under the proposal, all investment advisers to hedge funds that exceed a certain amount of assets under management would be required to register with the SEC under the Investment Advisers Act. Further, it is proposed that these investment advisers be required to report certain information about the funds they manage, in order to adequately assess whether a particular fund poses a threat to financial stability. The Obama Administration's proposal follows on the heels of a Senate bill introduced by Senator Jack Reed (D-RI) on June 16, which would require investment advisers to all private funds, including hedge funds, to register with the SEC if their assets under management exceed $30 million.