# SEC push to keep more hedge fund investments secret fails, report says

In July, the Securities and Exchange Commission proposed a new rule to greatly increase the threshold for assets-under-management at which investors have to disclose their equity holdings to $3.5 billion from $100 million. The move would have shrunk the number of firms that have to disclose such information by 90% — from 5,089 to 550, according to one analysis.

The SEC proposed the rule in part to reduce compliance costs on asset managers with fewer than $3.5 billion under management, with the aim of regulating the same share of asset managers today as when the $100 million threshold was adopted in 1978.

Public comments on the proposed rule change were nearly unanimous in their disapproval. An analysis by Goldman Sachs found only 24 comments out of 2,238 supported the rule change.

Large corporations opposed the move because it would give them less understanding of who their shareholders are, and other market participants decried the reduced transparency that would result from the change, and which would depress investor confidence.

Bloomberg reported that SEC officials were suprised by the level of opposition, but a statement said the regulator will continue to look for ways to reform the rule.

“It remains clear that the current threshold is outdated,” the agency told Bloomberg. “The comments received illustrate that the form is being used in ways that were not originally anticipated when the form was adopted. We are focused on examining these important issues before we move forward with determining the appropriate threshold.”