The world’s largest hedge-fund advocacy group has named a former U.S. Securities and Exchange Commission official its chairman as the $2.1 trillion industry grapples with increased regulation.
Kathleen Casey, who stepped down as a Republican SEC commissioner last year, was appointed non-executive chairman of the Alternative Investment Management Association, the London- based lobbying group said in an e-mailed statement today. She replaces Todd Groome, a former Deutsche Bank AG (DBK) executive and adviser to the International Monetary Fund, whose term expired.
Casey, 46, takes the post as global regulators implement rules ranging from restrictions on who can invest in hedge funds in Europe to U.S. requirements that funds undergo routine SEC inspections and disclose their leverage and investments to the government. European watchdogs are also considering whether to stiffen oversight of so-called shadow banking, a term that describes all financing activities not performed by banks.
“As we move internationally from a period of legislative drafting to regulatory implementation, her enormous experience will be invaluable,” AIMA Chief Executive Officer Andrew Baker said of Casey in the statement.
From 2006 through 2011, Casey served as one of the five SEC officials who vote on whether to adopt new regulations for the finance industry and to punish individuals and companies for violations of securities laws. Her tenure coincided with the meltdown of the U.S. housing market that led to the collapses of Bear Stearns Cos. and Lehman Brothers Holdings Inc. in 2008.
The resulting global financial crisis prompted the U.S. Congress to approve the 2010 Dodd-Frank Act, which increased regulation of banks and hedge funds.
Casey last year voted against a rule mandated by Dodd-Frank that requires hedge funds to register with the SEC. She argued that record-keeping and disclosure requirements that the SEC imposed on hedge funds managing less than $150 million undermined Congress’s intent that smaller firms be exempt from registration. The rule passed 3-2 with Democratic SEC commissioners supporting it and Republicans in opposition.
AIMA has 1,300 corporate members ranging from hedge funds to accounting firms and prime brokerage units at banks. Casey’s term as chairman lasts for two years. Groome had held the position since 2009, according to the statement.
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