The Securities and Exchange Commission’s (SEC) decision to withdraw the licenses of struggling fund managers has immediately rendered 249 people jobless; a figure which could exceed 1,200.
Although the SEC mass shutdown exercise involved 53 fund management companies, 21 firms had already ceased operations with the remaining 32 still in operation at the time their licenses were revoked.
Commenting on the matter of job losses, an SEC official explained that its engagement with the fund managers which were in operation before the shutdown showed that there were 249 SEC licensed investment advisors who will now be out of jobs.
The SEC official stated that these people are mostly the frontline staff who interact with customers adding that when the backroom staff of these collapsed institutions is added to the fray, the total job losses could possibly quadruple.
According to persons familiar with the operations with fund management companies, typically a branch would engage on average 25 people made up of accountants, credit and compliance officers, IT officers, security personnel, drivers, cleaners among others.
In some situations, some of these fund management companies have at least a branch plus its head office.