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Goldstein Comes Out Blazing Against State Regulator
by Paula Schaap ,Senior Reporter , October 19, 2009

Phil Goldstein, the hedge fund manager who stopped the Securities and Exchange Commission in its tracks when it last tried to register hedge fund firms, has stepped up his legal attack on Massachusetts regulator Secretary William Galvin.

Goldstein is in court with Galvin over the regulator’s accusation that a former Web site for Goldstein’s firm, Bulldog Advisors, constituted illegal advertising. Goldstein tried to get Galvin’s administration action against him dismissed saying it violated his First Amendment right.

Last month, an administrative judge backed the Massachusetts Secretary by dismissing part of Goldstein’s complaint.

Goldstein called the administrative hearing a “sham,” and asked why the state bothered with them.

“This is Massachusetts, not Zimbabwe,” Goldstein wrote in an e-mailed statement.

Bulldog is appealing the administrative judge’s decision.

Goldstein is known for his colorful language, as well as his willingness to take on regulators. In 2006, he challenged the SEC on its hedge fund registration rules and won.

Goldstein wrote Galvin wanted to “make it so painful for [his enforcement targets] that, even if they are innocent and may ultimately prevail in court, they will settle by accepting a cease and desist order and paying a fine, thereby implicitly admitting guilt, rather than go through a costly, lengthy and uncertain litigation.”

However, Galvin, “should have known that the guys that took on the SEC (and won) might not roll over as quickly as his other victims,” Goldstein wrote.

  
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2 Comments
Post your comments below.
POSTED BY Paula Schaap at 10/19/2009 3:24:07 PM

We need more people like Phil Goldstein, these regulators think they can make innocent hard working people roll over and accept whatever they say, just because theya re the big and powerful "regulators". All I can say is given recent history (Madoff) it is clear the regulators should be sorting their own shops out first before getting involved in mud slinging about other businesses they have no idea about!
POSTED BY Trevor Rose at 10/20/2009 11:24:37 PM
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