FOR IMMEDIATE RELEASE

October 11, 2023

CONTACT
Carter Dougherty
carter@ourfinancialsecurity.org

SEC Finalizes Important Ownership Reporting Rules Despite Fierce Industry Backlash

Washington, D.C. – The Securities and Exchange Commission’s decision to finalize important amendments governing beneficial ownership reporting despite fierce backlash from the hedge fund industry represents a significant move towards creating a more equitable investment landscape increasing transparency for other investors.

“These changes modernize rules written decades ago so that investors will now be better informed of large stakes taken by other investors that could have a significant impact on them,” said Andrew Park, senior policy analyst for hedge funds and private equity at Americans for Financial Reform Education Fund. “The SEC is also addressing a long-running gap between how stocks and derivatives with the same economic exposure are treated so that activist investors can no longer evade reporting or scrutiny simply by their choice of financial instrument.”

The rule received significant support from labor unions, which submitted a comment letter to the SEC to set the record straight after a misleading industry-backed campaign incorrectly suggested labor opposed the proposal. 

“Although we hoped the SEC would finalize a rule that maintained its proposed five calendar day filing window instead of watering it down to five business days, we are pleased that the agency generally stuck to its guns and finalized a strong rule that will protect investors despite a coordinated campaign by industry against it,” said Natalia Renta, senior policy counsel for corporate governance and power at Americans for Financial Reform Education Fund. 

For more information about the importance of this rule and the industry backlash, see our blog post from September 2022.

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