03:47 PM EDT, 03/18/2024 (MT Newswires) -- Trade groups representing fund managers are suing the US Securities and Exchange Commission over a new rule requiring some high-frequency traders and other specialty fund managers to register as dealers.

In a statement, Bryan Corbett, president and chief executive officer of Managed Funds Association said the SEC's new "Dealer Rule" is too vague and will result in many fund managers losing their customer protections with dealer counterparties. "Alternative asset managers are not dealers. They are customers of dealers," Corbett said.

In addition to the MFA, other plaintiffs in the civil complaint filed Monday in a federal court in Fort Worth, Texas, were the National Association of Private Fund Managers and the Alternative Investment Management Association.

The SEC did not immediately respond to a request for comment by MT Newswires.

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