Making a Million Bucks an Hour: How Hedge Funds Get Away With Siphoning Off America's Wealth
http://www.alternet.org/economy/making-million-bucks-hour-how-hedge-funds-get-away-siphoning-americas-wealth
You may be asking, Do you really have to cheat in order to make it into the million-an-hour club? Well, it depends on what you mean by cheat and have to.
You absolutely don t have tono, no, no, hedge-fund supporters assure us. There are only a few rotten apples in the hedgefund barrel, writes the ever optimistic journalist Sebastian Mallaby:
An industry of around 9,000 hedge funds is indeed bound to harbor some criminals. But insider trading is already illegal, and prosecutors have the tools to go after offenders in hedge funds without new regulations. The number of fraud cases suggests that regulators are not shy about using these powers, and hedge funds regularly experience inquiries from the SEC when they happen to trade heavily in a stock ahead of a price-moving announcement. Moreover, some of what politicians and journalists label hedge-fund abuses involve leaks of inside information from investment banks rather than from hedge funds, making the hedge-fund managers who receive the leaks accomplices rather than the chief offenders.
Youve got to admire how far Mallaby will go to exonerate hedge fundsgolly, they re not really bad crooks. They re not the chief offenders. They only drive the getaway cars! But how many getaway drivers are there? How does Mallaby or anyone else know that hedge-fund cheating is not widespread? And how, for that matter, would we prove the opposing viewthat foul play is endemic in the hedge-fund industry? In fact, until a lot of accomplices are wiretapped or tell all, it s virtually impossible for outsiders to really know the extent of the cheating.