NEW YORK (

TheStreet

) -- Hedge funds and private equity funds that have been flying under the radar of the

Securities and Exchange Commission

will now need to register with the regulator, according to a

Bloomberg

report on Friday.

In a four-to-one vote, the commissioners passed a preliminary rule that would force funds with more than $150 million in assets to register as an investment adviser, the report said. That designation would require funds to submit myriad of information to the regulator, including financial, compliance and investment documents.

The SEC specifically exempted venture capital funds and offshore investment advisers from the rules, however,

Bloomberg

said.

The rule change was prompted by passage of the Dodd-Frank Act, which expanded the definition of the type of firms that would be subject to the Investors Advisors Act of 1940. Prior to the rule change, many hedge funds were not required to register with the SEC since firms fell under the regulator's "private adviser" exemption.

The rule will officially become part of the hedge fund regulatory framework after a 90-day comment period.

Written by Christopher Westfall in New York

.