No overwhelming sentiment found for hedge funds

The SEC received about 100 comments on its proposed hedge-fund regulation changes during the agency's public comment period, which ended yesterday. Respondents were fairly evenly divided between support and opposition to the plan, which would require most hedge fund managers to register with the SEC, along with more disclosure. The Managed Funds Association, the primary hedge fund industry group, along with the U.S. Chamber of Commerce, wrote strong letters of opposition. The MFA also suggested that President Bush's Working Group on Financial Markets assess the information about hedge funds available to various federal agencies and recommend ways for those bodies to better share that data. The Investment Company Institute, the mutual fund industry's main lobbying group, supported efforts to tighten regulations on hedge funds. The Unfarallon Coalition, a student coalition seeking mandatory disclosure of hedge fund holdings, was also strongly supportive. Sources said the vote by SEC commissioners on the final regulations will likely be the same as it was for the preliminary vote, with two Democratic commissioners expected to vote with SEC Chairman William Donaldson and the two Republican commissioners likely to vote against the changes.