U.S. Congressional panel mulls wealth fund rules
WASHINGTON, Feb 28 (Reuters) - A new bipartisan Congressional panel aims to draft a set of "reasonable standards" for sovereign wealth funds, which have raised concerns after spending billions of dollars for stakes in major U.S. financial institutions.
"Clearly, the emphasis will be on transparency," Rep. Jim Moran, a Virginia Democrat, told Reuters on Thursday.
Lawmakers have been grappling with the growing clout of typically opaque government-owned funds, which have bought minority stakes in U.S. banks such as Citigroup Inc (C.N).
Moran and Rep. Tom Davis, a Virginia Republican, held the first meeting of a bipartisan task force on Thursday to examine the government-owned funds. One of the panel's main objectives was to develop some reasonable standards that can be consistently applied, Moran said.
The group plans to talk with the U.S. Treasury Department, which heads a committee that reviews corporate acquisitions involving foreign buyers. It also seeks input from the International Monetary Fund, which is developing a set of voluntary best practice guidelines for the funds.
"I think we would want to come up with recommendations that were as consistent as possible with what Europe is doing and consistent with the IMF," Moran said.
Moran said it was too early to talk about legislation linked to sovereign wealth funds. But there have been rumblings about legislative action on the Senate side.
Sen. Charles Schumer, chairman of the congressional Joint Economic Committee and a New York Democrat, has said that, if the IMF does not quickly come up with a voluntary code of conduct, Congress will consider legislation to ensure the funds' operations and intentions are made transparent.
According to the Congressional Research Service, the research arm of Congress, sovereign wealth funds manage an estimated $2.2 trillion and will grow to more than $13.4 trillion over the next decade. (Reporting by Rachelle Younglai; Editing by Andre Grenon)
