Hedge Funds Face New SEC Disclosures as Gensler Cracks Down
- Private equity firms also may see expanded filing requirements
- Agency weighs changes to non-public forms at Wednesday meeting
Large hedge funds and private-equity firms may soon have to start reporting steep losses, major redemptions and other extraordinary events in near real-time to the U.S. Securities and Exchange Commission -- a change that the regulator says will help it protect the financial system during meltdowns and wild swings like the meme stock mania that roiled markets a year ago.
The SEC proposed on Wednesday that big funds submit confidential forms within one business day when there are significant changes to their prime-brokerage relationships, available cash or counterparty defaults. The push to speed up the now quarterly filings, and gather more information, has been driven by the trading turmoil after the onset of Covid-19 in March 2020 and when retail investors plowed money into stocks such as GameStop Corp.