No one in the hedge fund community would risk saying it publicly, but some hedge fund money managers are claiming the Securities and Exchange Commission is on a vendetta against the $1.2 trillion industry.
In the past few weeks, the SEC has launched three stock trading investigations that until now have gone unreported. Also, the commission has increased its scrutiny of one of the city’s leading short sellers, Rocker Partners, which has already been sued for alleged stock manipulation.
Summing up the thinking of some hedge fund managers, one manager says there seems to be a mindset at the SEC that anyone who shorts a stock (betting its price will fall) is un-American or crooked. He says he has been hearing ever more complaints from fellow managers about an increase in calls from the SEC that center chiefly on short trades. He points out that such trades are perfectly legal.
