Practice

The SEC last week brought its first action against a mutual fund adviser regarding preparedness for computer problems arising from the turn of the century.

Automatic Data Processing of Roseland, N.J., has formed a new division to provide an array of retirement plan programs for mutual fund companies. The new division, ADP Retirement Services, will provide record-keeping and administration services to investment companies of all sizes, said Russ Fradin, president of ADP Employer Services for North America.

Fidelity Investments has developed a new 401(k) plan for small non-profit organizations. The new product, MaximumK, was created by Fidelity Investments Tax-Exempt Services Co. MaximumK is designed for companies with less than 1,000 employees and up to $10 million in assets. There are about 15,000 organizations in the U.S. that fit this profile, according to Fidelity. These groups include physician practices, research organizations, small church groups and labor unions, Fidelity said. Fidelity says it plans to keep costs low by eliminating customization usually provided to larger plans. Sponsors are given a choice of up to 25 Fidelity funds. MaximumK was offered to a limited group of organizations earlier in the year. It began selling the product generally May 5. A dedicated sales force is selling the plan.

BOSTON - A federal court judge here appears likely to substantially reduce and perhaps dismiss a lawsuit which challenges the independence of Fidelity Investments' mutual fund directors.

TIAA-CREF of New York, the $255 billion money manager, is taking steps to expand its new mutual fund business.

McLeodUSA of Cedar Rapids, Iowa, has selected MassMutual Retirement Services of Springfield, Mass., as the supplier for McLeod's $50 million, 4,000-participant 401(k) plan.

NEW YORK - The Securities and Exchange Commission is considering several amendments to the Investment Company Act to strengthen the role of independent directors of mutual fund companies, Paul Roye, the SEC's director of investment management, said last week. Roye spoke at a conference hosted by The Practising Law Institute of New York.

Americans pay scant attention to a future employer's 401(k) or other retirement savings plan when they accept a new position, a survey by Fidelity Investments of Boston has found.

Ford Motor Co. of Detroit has made Fidelity PortfolioPlanner, an online retirement tool sold by Fidelity Investments of Boston, available to all Ford employees. PortfolioPlanner helps 401(k) investors with retirement planning and asset allocation decisions, and gives them examples of model portfolios.

The mutual fund and securities industries are urging the SEC to delay and substantially revise proposed new rules which would set quality standards for transfer agents and broker/dealers.