November 25, 2005
Hedge funds dislike the idea of being charged 50 pounds for FSA breakfast
Here is a story of how someone playing in millions can kick a fuss over someone asking for small change. Financial Services Authority (FSA) organized a meeting with the hedge fund managers to apprise them of what it expects the members to do and how it feels that they should conduct themselves. Regulation has recently become a hot topic of discussion across the globe. This is stemming from the basic need of putting some checks in the industry so as to safeguard the interests of investors. The situation is attracting a lot of attention because the alternative investment vehicles that were available to only the institutional investors or the ultra rich is now percolating down to the masses as well.
Coming back to the FSAs meeting: The organizers of the meeting have asked all the attendees to pay for the breakfast that is going to be served at the meeting. The price is pegged at 50 pounds. A petty amount one may feel for the managers some of whom form the top earners in the financial markets. Despite this reality, there is uproar about why the amount is being charged.
The argument being presented is that when the funds are paying the authority almost 50,000 pounds per year for being allowed to trade, why are they asking to be paid for the breakfast. The registration invite sent out to the industry included the details of what to expect at the meeting and mentions very clearly that the registrations will not be entertained without the mentioned ‘breakfast’ fee.
The fund managers feel that this could have been acceptable if the organizers were imparting a training of some sorts. But to pay for a breakfast where they are being invited to listen to the representatives of FSA on how they will be imposing regulations on the invitees is absurd. The FSA however maintains that a fee of this kind has always been charged when ever an event like this is being organized and went on to specify that the breakfast will include croissants, pastries and coffee. Reuters reports:
“The audience with Andrew Shrimpton, the head of the FSA's new hedge fund supervisory unit, is in early December and the regulator said it will give hedge fund managers a chance to talk over industry issues.”
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