It was a clash of cultures, a face-off between secretive capitalists and hard-nosed politicians yesterday, as hedge funds faced the Treasury Select Committee on the banking crisis.

Four prominent hedge fund managers faced hostile accusations from the cross-party selection of MPs as they fought to retain the light regulation that has allowed the industry to thrive and generate trillions of pounds of profit in recent years under much less scrutiny than banks.

But they faced probing questions in the wake of the financial meltdown and the Bernie Madoff scandal, where hedge funds, pensions and banks lost $50bn (£35bn) in an alleged fraud in the US. And as the MPs pushed the hedge funds on the industry's secrecy and its power to disrupt the financial system, those facing them fought to limit how much they need to disclose to the public and tried to keep regulators at bay.

"Blaming the hedge funds for the banking crisis is like blaming the passengers in a bus crash," Paul Marshall, co-founder of the Marshall Wace hedge fund, one of the funds that held short-selling positions in HBOS last summer, argued to the committee.

Hedge funds are among a number of sectors being hauled in front of the committee as part of a continuing hearing. Those in what at times seemed like a court dock were Andrew Baker, head of hedge fund trade organisation the Alternative Investment Managers Association (AIMA); Mr Marshall; Douglas Shaw, a managing director at the hedge fund manager Blackrock; and Stephen Zimmerman, chairman of NewSmith Capital Partners.

http://www.independent.co.uk/news/uk/politics/hedge-fund-bosses-tell-mps-we-are-the-victims-1517847.html