SEC registration may hedge the issue of fraudulent behavior

Commissioner Paul S. Atkins opened the Edward Lane-Reticker Speaker Series with a critique of the rule requiring hedge fund advisors to register with the SEC.

Calling the rule “costly and ineffective,” the new rule will not do much to deter fraudulent behavior and will only increase the administrative burden on the SEC, taking away manpower and resources which would be better allocated to overseeing mutual funds in which more people of modest means invest. He said that while the policies seem appropriate, a closer inspection would reveal them to be “rooted rather tenuously in reality.”

The rule, which has been in place since 2004, is currently the subject of a case before the US Appeals Court in Washington. Instead of registration, Mr. Atkins said that he preferred a system of oversight in conjunction with the Treasury Department.

The lecture, which was organized and sponsored by the Morin Center, was originally scheduled to be held at Barristers Hall at the Law Tower. However, due to the size of the crowd that attended, it was moved to the adjoining auditorium. The lecture series was organized in honor of the late Edward Lane-Reticker, the former Associate Director of the Morin Center. Before the Commissioner spoke, a plaque commemorating the occasion was presented to Mrs. Laurie Lane-Reticker.

The speaker series will host a lecture once every academic term with the next lecture scheduled during the fall term.

Listen to Commissioner Atkins’ speech: Download MP3