Tim Geithner, treasury chief of the US, defends hedge funds and rich investors and needs to be removed from his position..

Geithner warns of rift over regulation
By Martin Arnold and Sam Jones in London and Nikki Tait in Brussels

Published: March 10 2010 20:50 | Last updated: March 10 2010 20:50

Tim Geithner, US Treasury secretary, has delivered a blunt warning to the European Commission that its plans to regulate the hedge fund and private equity industries could cause a transatlantic rift by discriminating against US groups.

A letter sent by Mr Geithner this month to Michel Barnier, Europe’s internal market commissioner, makes it clear that the European Union is heading for a clash with Washington if it pushes ahead with what the US – and Britain – fear could be a protectionist law.

The debate over the shape of future financial regulation has reached a critical point in Brussels. Diplomats were on Wednesday night moving closer to a compromise on the sweeping overhaul that has angered the industry and worried institutional investors.

- tough, they shouldn't be trying to destabilise governments that are sorting out the mess they made in the first place , they should stop speculating and get a real job producing something -

The draft EU directive would impose tighter restrictions on hedge funds, private equity and other alternative investment funds. It has caused alarm in the City of London, where some in the industry say it is a thinly veiled attempt by France and Germany to undermine the UK’s dominance of financial services.

If European diplomats reach agreement at a meeting on Thursday, the directive will be put to EU finance ministers when they convene on Tuesday. The proposed rules will require approval by EU lawmakers.

Mr Geithner’s one-page letter, sent on March 1, stresses the need for the US and Europe to work together on regulation of the financial services industry.

- The US does not regulate, their idea of regulation is putting wolves guarding sheep. Self regulation died with the crisis! -

Mr Geithner warns that US hedge funds, private equity groups and banks could be discriminated against if proposals to restrict the access of EU investors to funds based outside the 27-country bloc are included in the final law.

So-called “third country” elements of the directive would force non-EU funds to comply with the new rules if they wish to market themselves at all within the EU.

- We europeans had quite enough of american financial products, they are tainted by fraud because the SEC is toothless and generally only cares about business not citizens. Not in the EU sorry! -

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