Galvin warns on hedge funds

Massachusetts Secretary of State William F. Galvin today strongly voiced opposition to the federal government's conclusion that hedge funds do not require more regulation.

Galvin, the chief securities regulator for the state, said in a statement, "The decision of the President's Working Group on Financial Markets to leave to the workings of market discipline the risks that hedge funds represent is simply the wrong approach to an increasing problem."

Galvin added: "Hedge funds may be appropriate for the sophisticated investors - though we have seen such funds cross that line - but increasingly the money these unregulated and almost anonymous funds deal with are the pensions and retirement accounts of those who are not these sophisticated investors. It is the money of those who do not realize the extent to which their life savings are at risk in a highly speculative environment."
(By Chris Reidy, Globe staff)