Baltimore Sun – A Securities and Exchange Commission proposal to sharply limit the number of Americans who can invest in hedge funds has triggered a public backlash – and the latest controversy over the booming private investment pools.
The agency has received hundreds of e-mail messages and letters since December, when it proposed raising the financial bar for hedge fund eligibility for the first time since 1982.
Most of those writing have advised the SEC to back off. Some comments have an angry tone, unusual for matters of securities regulation.
“This has got to be unconstitutional, if not communistic,” wrote M. Joan Conrad, a Naples, Fla., resident who says she has had money in hedge funds for the past decade.
The commission proposed limiting participation in the largely secretive and unregulated investment vehicles to investors who have a minimum of $2.5 million in investable assets, excluding the value of their primary residence.
Currently, investors must have a minimum of $1 million in net worth, including real estate, or earn at least $200,000 a year.
