U.S. Senate Passes Massive Hedge Fund Managers Regulation Bill

Article by Robert P. Bramnik , David J. Kaufman , Laurence S. Lese , Howell J. Reeves and David B. Bernsohn

The U.S. Senate has passed the Private Fund Investment Advisers Registration Act of 2010 (the "Senate Bill"), which, if enacted in its present form, may have a dramatic impact on anyone who advises or manages a hedge fund or other investment-related pool of capital. In addition, when the Senate Bill is reconciled with a similar bill passed by the U.S. House of Representatives, the resulting legislation may also impact persons who advise small groups of clients, including so-called "family" accounts. Under the provisions of the Senate Bill, any private-fund advisor or manager with assets under management of at least $100 million would be required to register as an investment advisor with the U.S. Securities and Exchange Commission (the "SEC"). Advisors and managers with assets under management of less than $100 million, absent an available exemption,