The 32nd annual conference of International Organisation of Securities Commissions (IOSCO), which concluded here today, favoured a combination of direct and indirect regulations to tackle the might of hedge funds, known for their quick entry and exit from various markets and asset classes. | |
| The four-day meet of IOSCO felt that hedge funds, which handle around assets worth $ 1.4 trillion, were not a necessary evil and there was no need to demonise them. |
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| "The issue of hedge funds is very complex. We discussed the risks posed by hedge funds in the system. There is no unique approach to regulate them. The trend is towards indirect regulation. (But) wherever public funds are involved, direct regulations may come in," Michel Prada, chairman of the IOSCO Technical Committee and President of French regulator AMF, told reporters. |
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| "If hedge funds handle merely professional investors and high networth individuals, then indirect regulations is the rule of the game," he said, adding that hedge funds should not be demonised as they played a positive role in bringing more liquidity. |
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| Recent debacles of hedge funds have shown that the markets were able to deal with them without any major problems. "I'm not saying that they (hedge funds) do not bring any danger," he hastened to add. |
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| The IOSCO conference also discussed the issue of valuation of hedge funds as 23 per cent of their assets comprise of illiquid positions. Valuation of such illiquid stocks has been an issue, as each fund follows different valuation methods. |
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| Money laundering just got tougher |
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| Money laundering through tax havens of British Virgin Islands, Bermuda and Luxembourg has been made tough with the International Organisation of Securities Commissions (IOSCO), an organisation of global securities and futures' regulators, today signing agreements with regulators in the three countries for more effective cross-border enforcement. |
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| IOSCO signed memoranda of understanding (MoU) with Bermuda Monetary Authority, Financial Services Commission of the British Virgin Islands and Commission de surveillance du secteur financier of Luxembourg. |
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| "It (convincing them to become signatories of IOSCO) is a significant achievement for us," Michel Prada, chairman of IOSCO Technical Committee, said. |
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