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New York (HedgeCo.Net) – Connecticut has long been a haven for the hedge fund industry; where light regulation and a dense population of ultra wealthy investors lure the most talented of hedge fund managers.  But if some state lawmakers have their way, hedge funds will have to jump through a lot more hoops than they are used to, according to the Hartford Business Journal.

Under current law, hedge funds only allow accredited investors who have a net worth of $1 million or higher to participate.  The proposed legislation would bump that minimum requirement up to $2.5 million, with institutions needing at least $5 million in assets.

The new legislation would also require hedge funds to provide greater transparency by disclosing their fees and other information about management or investment strategy.  Hedge funds would also be required to obtain a state license as well as have an independent annual financial audit performed.

Many fear that by imposing these guidelines, Connecticut would have less of a draw, and many hedge fund managers could simply pack up and move to nearby metropolises like New York or Boston.

The pull for stricter oversight on hedge funds is by no means limited to the state level.  Many members of Congress have been pushing for greater transparency after hedge funds got blasted for having a hand in the financial crisis thanks to controversial practices like short selling. 

Others push for heightened regulation due to the recent outbreak of Ponzi schemes from so-called “trustworthy” individuals, like Arthur Nadel of Sarasota or the obvious case of Bernard Madoff where hundreds of investors were swindled out of their retirement.  However, many who oppose the oversight based on increased fraud argue that investors are ultimately responsible for where their money goes and should perform greater due diligence themselves before trusting anyone with large sums of capital.

Republican State Representative John Stripp told the Hartford Business Journal that it’s not about a “vendetta against hedge funds,” just that “there is a need to have some kind of regulation in place.”

Even European finance ministers agreed this past weekend to the direct regulation of hedge funds overseas, leading most to believe that the era where hedge funds could get away with anything, is coming to an abrupt end.

Julie Scuderi
Senior Editor for HedgeCo.Net
Email: julie@hedgeco.net

HedgeCo.Net is a premier hedge fund database and community for qualified and accredited investors only. Membership on www.hedgeco.net is FREE and EASY. We also offer FREE LISTINGS for Hedge Funds!
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Tags: accredited-investors, bernard madoff, dense population, due diligence, financial-audit, hartford business journal, hedge-fund-managers, hedgeco, investment strategy, many-fear, members-of-congress, metropolises, new legislation, ponzi schemes, representative john, republican state representative, state lawmakers, stripp, wealthy-investors

New York (HedgeCo.Net) – Italian automaker Fiat S.p.A. may be interested in acquiring a stake in Chrysler that could help lift the U.S. automaker out of financial distress.

According to an article published on autonews.com, Fiat may invest in a 30-35% stake in Chrysler, while helping the company to design vehicles that create fewer emissions.

While the website didn’t cite specific sources, Chrysler is maintaining ambiguity by stating they do not “confirm or disclose the nature of its private business meetings.”  They also downplayed the situation by saying that, “In today’s economic environment, talks are going on between companies in all industries – ours is no different.”

Chrysler, who has already received $4 billion in rescue funds from Uncle Sam, shut down production in all of their U.S. plans in December until inventory is moved.  Many fear that Chrysler cannot weather the storm unless they align themselves with a partner.   

Fiat would provide new engine and transmission technology that would help Chrysler to produce more fuel-efficient vehicles that pollute less, said people familiar with the matter.

Private equity firm Cerberus Capital Management currently holds an 80.1 percent stake in Chrysler, while Daimler holds the remaining 19.9 percent.

Julie Scuderi
Senior Editor for HedgeCo.Net
Email: julie@hedgeco.net

HedgeCo.Net is a premier hedge fund database and community for qualified and accredited investors only. Membership on www.hedgeco.net is FREE and EASY. We also offer FREE LISTINGS for Hedge Funds!
Be sure to check out our sister sites. www.hedgefundlounge.com, www.hedgefundtools.com, and www.hedgefundemployment.com

Tags: accredited-investors, ambiguity, business meetings, capital-management, daimler, economic environment, financial-distress, fuel efficient vehicles, hedgeco, italian automaker, many-fear, more fuel efficient vehicles, private business, private equity firm, sister-sites, transmission technology, uncle sam, weather the storm

Time – Here’s one upside to a down market: a number of historically prominent mutual funds that long ago shut their doors to new investors are reopening.

It’s been years since anyone without an existing account could put money into some of the best-known names in the business, like Sequoia Fund, Dodge & Cox Stock, Longleaf Partners, Fidelity Magellan, Artisan Mid Cap Value, Oakmark Equityand Income, Vanguard International Explorer and Third Avenue Small-Cap Value.

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Tags: commitments, fraud, many-fear, medallion, newcastle, prentis, stocks, third-party