The ICI's mounting dissatisfaction with Congress over legislation that strips away hedge fund regulations and lifts the ban on these funds advertising is still gaining traction in the press. Beverly Goodman reports on the spat in Barron's over the weekend.

Dow Jones first reported on the fight on Thursday.

The law in question is the JOBS act from April, which was designed to allow small businesses to raise money. With most hedge funds taking the form of small companies, this seems to strip away some of the oversights that previously governed the hedge fund industry.

The Securities and Exchange Commission, mutual fund industry representative the Investment Company Institute, Fund Democracy, the Consumer Federation of America, the AFL-CIO and other groups have registered complaints over the law.

The ICI sees the law as threatening to mutual funds, because if they have fewer regulations and are able to advertise, the competition could be tilted in favor of hedge funds.

"We live under a regime the SEC imposed with very specific dos and don'ts," ICI president Paul Schott Stevens said to Barron's. "Hedge funds don't have any uniformity in reporting, and calculating performance is much more challenging given some of their illiquid or complicated strategies. But hedge funds are very desirous of being able to advertise performance free of any restrictions."

The new law takes effect in July. 

Edited by: Ben Geier


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