September 15, 2004
To whom it may concern,
I oppose the initiative to extend SEC jurisdiction to direct oversight of hedge fund managers. Although the SEC has suggested that the growing pool of capital allocated to hedge funds poses risks to the financial system, these risks are already closely monitored and controlled through regulations and internal policies of the prime brokers and other financial institutions that trade with, and extend credit to, hedge funds, as well as the regulators that directly oversee these institutions. Furthermore, I do not support the SECs proposal to require hedge fund managers to register under the Investment Advisers Act. I believe that this sweeping new regulation will ultimately stifle the ingenuity and entrepreneurship that have characterized successful firms in this industry. Investors in general will be worse off as a result.
Finally,I write in opposition to the SECs proposal to require hedge fund managers to register as investment advisers because I share Federal Reserve Chairman Alan Greenspans view that the current system of voluntary registration is appropriate and that the SECs scarce resources may be used more productively in other areas.