Hedge fund managers invest on hill – politico hedge fund holdings

According to a review of Federal Election Commission records, the nation’s 10 richest hedge fund managers have dumped nearly $1 million into campaign accounts over the past several years — with much of it going to senators who’ve given them a friendly reception on Capitol Hill.

And despite all the tough talk about a crackdown on Wall Street, consumer advocates and critics from other financial sectors say hedge funds would get off pretty easily under the regulatory reform bill Dodd’s committee approved last month — a charge Dodd’s aides reject.

Many hedge funds enjoyed an enormously profitable year in 2009, in part because of good bets that federal dollars would be used to rescue “too-big-to-fail” financial institutions. And the Top 25 earners made more than $25 billion last year, according to a recently released survey

by Absolute Return + Alpha magazine.

Those Top 25 feature some familiar names in Capitol Hill’s fundraising quarters, including liberal investor George Soros, who earned $3.3 billion last year and has dropped $42,000 of his cash into Democratic campaigns in the past few years.

For instance, Carl Icahn of Icahn Capital, who earned $1.3 billion last year, pumped $4,600 into New Hampshire Democrat Jeanne Shaheen’s 2008 campaign to unseat then-Sen. Hedge funds vs mutual funds John Sununu — only to give Sununu $1,000 a short while later.

Steven Cohen of SAC Capital Advisors, who earned $1.4 billion last year, contributed $59,000 to the Democratic Senatorial Campaign Committee’s coffers in 2006 and 2007 and $58,900 to the National Republican Senatorial Committee in 2007 and 2009, records show.

Sheila Krumholz, executive director of the Center for Responsive Politics, which tracks campaign donations and lobbying, said that the hedge fund industry’s political contributions skyrocketed 16,000 percent from 1990 to 2008, with the bulk of the cash flowing in the past election cycle when the industry spent $17.2 million. Hedge fund best And she said that lobbying by the booming industry has increased substantially, too, pointing to a 680 percent increase in lobbying expenditures between 2006 and 2007.

Industry officials argue that hedge funds and other private investment pools are not large enough to bring down the system and should be subject to less stringent regulations than the major financial institutions that helped spawn the global recession — and that often only a wealthy private investor loses money if a hedge fund crashes.

And Dodd’s aides contend that the Banking Committee took an aggressive posture towards the investment pools that are now largely unregulated.

“Dodd’s bill imposes tough new restrictions on hedge funds, including better regulation, greater disclosure and protections to the economy as a whole,” said Kirstin Brost, a Dodd spokeswoman. Hedge fund jobs ny “Sen. How do you become a hedge fund manager Dodd never has allowed campaign contributions to influence his positions. Working in a hedge fund It’s just silly to suggest he’d start when he’s not running for reelection.”

But critics say that the Senate Banking Committee bill will be ineffective if it doesn’t provide for even stronger regulation of the hedge fund industry and private equity firms.

“Failing to pass legislation that allows the [Securities and Exchange Commission] to oversee hedge funds and private equity will leave critical holes in the regulatory framework and allow systemic risks to build in the shadowy financial markets,” said Heather Slavkin, AFL-CIO’s senior legal and policy adviser.