AARP, a 35 million-member non-profit advocacy organization of people 50 years of age and older, threw its support behind many of the provisions of the Mutual Funds Integrity and Fee Transparency Act of 2003 on Thursday, ahead of Fridays markup of the proposal.
In a letter addressed to Capital Markets Subcommittee Chairman Richard H. Baker (R -LA) and Ranking Member Paul E. Kanjorksi (D PA), AARP said it strongly supports provisions that require fees to be disclosed in dollar amounts. AARP also approved fee disclosures to incorporate all fees, including portfolio transaction costs, and that all distribution expenses be identified in the statements.
AARP also voiced concern that "too much discretion" is being granted to the SEC to develop rules that leave investors without the legislations promised benefits. The group said it is concerned that smaller funds could be disadvantaged by fee disclosure provisions.
The group, which was formerly known as the American Association of Retired Persons, said it also supports provisions that call for disclosure of compensation paid to portfolio managers and retail brokers. "The disclosure of individualized expenses has the potential to benefit investors by providing them with a clearer understanding of the impact of different fee structures," Michael W. Naylor, the groups director of advocacy, wrote in the letter.