The New York Stock Exchange plans to intensify hedge fund analysis to uncover illegal trading, according to Bloomberg News. “Given the proliferation of hedge funds and the impact they can have on a marketplace, we’re looking at ways to build up our database on hedge funds,” says Robert Marchman, head of market surveillance for the NYSE.
In order to watch out for hedge fund crime, the NYSE has partnered with the NASD, the SEC and the Chicago Board Options Exchange. The NYSE has collected data on company leaders, as well as 1.5 million people in the industry.
“It’s important to look inside those black boxes for insider trading and, in the long run, for other things,” says Harvey Goldschmid, a former SEC commissioner who had voted for the failed proposal that hedge funds register. “Given the kind of resources hedge funds have today, it’s unwise to leave them without any regulatory oversight.”