[StBernard] Committee Approves Private Advisor Registration Bill with Bipartisan Support

[Westley Annis]

For Immediate Release:                                 

October 27, 2009                                                    

 

Committee Approves Private Advisor Registration Bill with Bipartisan Support

Washington, DC - Today, the House Financial Services Committee passed H.R.
3818, the Private Fund Investment Advisers Registration Act, introduced by
Congressman Paul E. Kanjorski (D-PA), Chairman of the House Financial
Services Subcommittee on Capital Markets, Insurance, and Government
Sponsored Enterprises.  The Committee passed H.R. 3818 with extensive
bipartisan support by a vote of 67-1.  Tomorrow, the Committee is expected
to vote on Chairman Kanjorski's H.R. 3817, the Investor Protection Act and
H.R. 3890, the Accountability and Transparency in Rating Agencies Act.

"The Private Fund Investment Advisers Registration Act, which passed today
with wide-ranging bipartisanship support, will force many more financial
providers to register with the Securities and Exchange Commission," said
Chairman Kanjorski.  "The past year has shown that the deregulation or in
many cases, lack of regulation, of financial firms is an idea of the past.
Advisors to financial firms must receive government oversight and we must
understand the assets of financial firms, including for hedge funds, private
equity firms, and other private pools of capital.  Under this legislation,
private investment funds would become subject to more scrutiny by the SEC
and take more responsibility for their actions.  I look forward to moving
this legislation to the House floor for a vote."

A summary of H.R. 3818 follows:

*	Everyone Registers. Sunlight is the best disinfectant. By mandating
the registration of private advisers to private pools of capital regulators
will better understand exactly how those entities operate and whether their
actions pose a threat to the financial system as a whole. 

*	Better Regulatory Information. New recordkeeping and disclosure
requirements for private advisers will give regulators the information
needed to evaluate both individual firms and entire market segments that
have until this time largely escaped any meaningful regulation, without
posing undue burdens on those industries. 

*	Level the Playing Field. The advisers to hedge funds, private equity
firms, single-family offices, and other private pools of capital will have
to obey some basic ground rules in order to continue to play in our capital
markets. Regulators will have authority to examine the records of these
previously secretive investment advisers. 

###