Former US regulator pans hedge fund reporting plan

* Ex-SEC official: SEC plan fails in cost-benefit analysis

* SEC plan aims to help regulators reduce systemic risk

By Sarah N. Lynch

WASHINGTON, Feb 5 (Reuters) - A proposal requiring hedge fund advisers to turn over large amounts of data to regulators is burdensome and too costly, a former U.S. securities regulator said on Saturday.

Paul Atkins, who served as a commissioner at the Securities and Exchange Commission, told current regulators at the SEC that their analysis of the costs it would bring to the industry was "woefully inadequate."

"I am very worried this will be one more block for building up a reason for people to move abroad," he said at SEC Speaks, a conference held each year in Washington by the Practising Law Institute.

The SEC's proposal, which was unanimously put out for public comment last month, would require advisers to hedge funds and other private funds report key information to regulators.

The rule would arm the newly formed Financial Stability Oversight Council with better information about hedge funds, private equity funds and so-called "liquidity funds" such as unregistered money market funds. The aim is to ensure their trading activities do not pose a risk to the broader marketplace.

The plan establishes a tiered regulatory approach that would subject advisers to large private funds valued above $1 billion to more extensive and frequent reporting.

Advisers to these larger funds would have to file quarterly reports with fairly detailed information to regulators.

The proposal estimates that advisers to large hedge funds will incur a cost of $23,270 to file the initial quarterly report, and $9,700 for each subsequent report.

Atkins said he felt this cost estimate was far too low and did not account for legal costs. He called the quarterly reporting requirement "shocking." (Editing by Mohammad Zargham)