The Boston Globe takes a look at how hedge fund managers are reclaiming some clout in Washington after last year's economic meltdown.
The paper reports that a new lobbying strategy, a former congressman and an upswing in campaign donations are helping the hedge fund industry regain its influential voice on Capitol Hill.
Hedge funds were the brunt of much criticism following last year's financial crisis -- 1,000 of about 10,000 hedge funds shut down after last year, and Federal Reserve chairman Ben Bernanke said insurer AIG crashed because it acted like a hedge fund.
But the industry has responded with a fresh lobbying push to stave off any further regulations. The Globe reports that as other financial sectors struggle to fend off regulation, hedge fund operatives have accepted reform more successfully.
Now with former Louisiana Congressman Richard Baker -- whose lobbying ban on Congress expired earlier this year -- at the helm of the hedge fund group Managed Funds Association, the industry is poised to make a comeback, according to the Globe.
Baker wrote in a blog distributed to hedge fund traders, "I have held scores of meetings with my former colleagues. Later in an interview with reporters he said, "We are no longer something that can be ingored by regulators or by the Congress."
But the bad PR on the hedge fund industry isn't letting up just yet. The Wall Street Journal reports today that Raj Rajaratnam, a billionaire and former president of a hedge fund advisory group Galleon Management LP, has been charged by the Securities and Exchange Commission with engaging in a massive insider trading scheme that generated more than $25 million.