# kaal:claim:2715083-026

**Claim.** FSOC's SIFI designation framework does not distinguish between mutual and hedge funds, even though evidence indicates designation would have disparate effects on the two asset classes.

**Type.** failure  **Support.** argued

**Holds when.**

- FSOC three stage nonbank SIFI designation process
- 12 C.F.R. 1310 app. A

**Source quote.**

> While evidence exists that SIFI designation could have disparate affects on mutual and hedge funds (Stevens Letter (2015), the applicable regulatory framework does not distinguish between the two asset classes.44

**From.** Kaal, *Confluence of Mutual and Private Funds* (2016), IV.2 Regulation, page 15

**Cite as.** Kaal, Confluence of Mutual and Private Funds (2016). SSRN: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2715083

**Verify.** sha256 of source PDF `b5c92186260d4a8499a14f81ee24ace093b24e7740af3effcd1c526fa4fa221e` at https://raw.githubusercontent.com/wulfkaal/Academic-Papers/main/papers/pdf/Kaal%20-%202016%20-%20Confluence%20of%20Mutual%20and%20Private%20Funds.pdf

**Failure mode.** Asset class blind SIFI designation  (family: measurement-and-metric-failure)

**Topics.** systemic-risk, risk-and-incentives

**Keywords.** sifi, fsoc, systemic-risk, regulatory-convergence

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