Practice

Retirement planning and retirement plans are key factors in mutual fund sales and offer an opportunity for growth for the industry, a new Investment Company Institute report suggests.

A United States District Court judge has fined a former Los Angeles mutual fund manager $1 million in restitution, interest and penalties for misrepresenting the value of two worthless funds as $138 million, combined, to two brokerage firms in order to obtain margin loans.

The City of New York's 457 deferred compensation plan, which has $250 million in assets under management, in November will begin offering employees a separate account managed by Citizens Advisers of Portsmouth, N.H. Citizens is the investment adviser to the socially- and environmentally- responsible Citizens Funds.

A tight labor market in the mutual fund industry is creating new business for courtroom lawyers - filing suit on behalf of money management firms to enforce the non-compete provisions in executives' employment agreements.

SAN DIEGO, Calif. - The Securities and Exchange Commission in November will adopt corporate governance regulations to strengthen the role of independent directors, an SEC official told attendees of the Investment Company Institute's tax and accounting conference here last week. The SEC had initially said it would issue new regulations in the summer.

The SEC, which increasingly is examining the securities trading practices of money managers, has sued an investment adviser for allegedly failing to get the best execution of trades for its clients.

Van Kampen Investment Advisory Corp. of Oakbrook, Ill. and former company chief investment officer Alan Sachtleben have agreed to pay $125,000 in fines for what the SEC said was misleading advertising about the performance of the Van Kampen Growth Fund. The SEC announced the settlement Sept. 8.

NASD Regulation has proposed a rule to bar broker/dealers from paying registered representatives more for selling proprietary mutual funds than for selling funds offered by outside fund companies. The practice of paying representatives more for selling house funds can create a conflict of interest between representatives and their clients, NASDR said in issuing the rule proposal Sept. 2. NASDR members have until Oct. 29 to comment on the proposal. In June, NASDR officials said they expected to issue such a proposal to ban extra pay for proprietary sales this summer. (MFMN, 7/12/99)

Complex derivatives are unnerving that part of the accounting industry that audits mutual funds.

Investors in the $40 million Navellier Aggressive Small Cap Equity Fund may not have to pay the costs of a lawsuit between the fund's adviser and two of its trustees.